Welcome to the First Quarter 2016 Yelp Earnings Conference Call. My name is Stephanie, and I'll be your operator for today's call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. Please note that this conference is being recorded. I'll now turn the call over to Wendy Lim. Wendy Lim, you may begin.

Good afternoon, everyone, and thank you for joining us on Yelp's first quarter 2016 earnings conference call. Joining me on the call today are CEO, Jeremy Stoppelman; and CFO, Rob Krolik; and COO, Geoff Donaker, will join us for Q&A. Before we begin, I'll read our Safe Harbor statement. We'll make certain statements today that are forward-looking and involve a number of risks and uncertainties that could cause actual results to differ materially. Please note that these forward-looking statements reflect our opinions only as of the date of this call and we undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements in light of new information or future events. In addition, we are subject to a number of risks that may significantly impact our business and financial results. Please refer to our SEC filings, as well as our financial results press release for a more detailed description of the risk factors that may affect our results. During our call today, we will discuss adjusted EBITDA, non-GAAP net income and non-GAAP EPS, which are non-GAAP financial measures. In our press release issued this afternoon and our filings with the SEC, each of which is posted on our website, you'll find additional disclosures regarding these non-GAAP financial measures and a reconciliation of historical net income to adjusted EBITDA and non-GAAP net income and GAAP EPS to the non-GAAP EPS. And with that, I will turn the call over to Jeremy.

Thanks, Wendy, and welcome, everyone. We had a great start to the year with local revenue growth accelerating to 40% year-over-year, driven by the continued strength of our recurring revenue base, as well as better than expected ad budget fulfillment and strong sales team results. This year, we're prioritizing building our core local advertising business, growing transactions, and increasing consumer awareness, and we continue to see tremendous long-term growth potential in these three areas. Our local advertising business is our top priority, given the significant opportunity to drive higher penetration in our existing markets. To illustrate that point, consider our progress within the Philadelphia metro area, where we began selling in 2010. Revenue in that market grew to approximately $6 million in 2015, yet only about 2% of local businesses in the Philadelphia metro area advertise with us. So we believe we still have plenty of room to grow. In the Los Angeles metro area, where we've been selling for nine years, about 4% of businesses advertise with us. Revenue in that market continues to grow, up more than 30% year-over-year in the first quarter of 2016. As we've grown communities, content and consumer awareness on a city-by-city basis, we have also successfully built a national presence. Today, we have reached a level of scale where national and multi-location businesses represent a big opportunity for Yelp. According to BIA/Kelsey, advertising dollars spent at the local level in 2015 by these larger businesses represent $90 billion or roughly 60% of the local advertising market. In the first quarter, revenue from chain and franchise businesses comprised approximately 20% of local advertising revenue. Over the years, we've enhanced our product offering to better serve large multi-location businesses, enabling us to acquire new customers and expand on existing advertising relationships. One such advertiser is…

Thanks, Jeremy. Please note that we've posted an updated Investor Presentation and data sheet on our Investor Relations' web page that accompany the financial portion of the webcast. In the first quarter, we achieved strong results as revenue grew 34% year-over-year to $159 million. Excluding brand revenue in 2015, year-over-year revenue growth would have been 42%. First quarter revenues came in slightly ahead of our guidance range, primarily driven by better than expected ad budget fulfillment and slightly above average salesperson productivity. For the first quarter, local revenue was $138 million, up 40% over last year. Transaction revenue was $14.5 million compared to $6.6 million in the first quarter of 2015, primarily reflecting our acquisition of Eat24 a year ago. Other revenue was $6 million. International revenue contributed about 2% of total revenue in the first quarter. Our customer repeat rate, defined as a percentage of existing customers from which we recognize revenue at some point in the immediately preceding 12-month period, was 76% for the first quarter of 2016. Cost of revenue in the first quarter was consistent with the prior quarter as we continue to invest in our hosting and testing infrastructure, resulting in a gross margin of 90%. Total sales and marketing was approximately 60% of revenue in the first quarter compared to approximately 53% last year, primarily driven by our investments in marketing and sales head count. Sales head count in the first quarter grew about 40% year-over-year to approximately 2,300. Product development was essentially flat as a percentage of revenue compared to last year at approximately 20%. G&A was 14% of revenue compared to 17% in the first quarter of last year. GAAP net loss was $15.5 million, and GAAP EPS was negative $0.20 in the first quarter. Non-GAAP net income, which excludes stock-based compensation…

Thank you. Our first question comes from Mark Mahaney with RBC Capital Markets. Your line is open.

Hey. Thanks. A couple of questions. Jeremy, you mentioned this ad budget fulfillment came in better than expected. It's a question for either you or Geoff. Could you just explain what that means? And then I wanted to follow up with one or two product questions.

Hey, Mark. This is Geoff. Yeah. We did have some really nice improvements on the ad delivery team this quarter. We think of those as one-time improvements from Q4 to Q1 and thus some of the beat on the revenue side. That meant that effectively the budgets that we get from each of our local advertisers were fulfilled that are slightly better than previous period basis or rate. And what caused that was some improvement in ad targeting in specific as well as some improvement in our auto-bidding algorithm.

Okay. And then the two product questions and you have this in your slides, too, about – it looks like you're kind of increasingly prioritizing the transactional functionalities in the app itself. Could you talk about how much of the opportunity or how many businesses on the site actually use that? Like how much gap-up opportunity is there for you? And then just on the Request a Quote business, can you talk about how you monetize that, whether you've started to monetize that and how you think about that potential long term? Thank you very much.

Sure. Hey, Mark, this is Jeremy. So, on the transaction side, we do feel like there is pretty broad potential there. Right now, a big portion of that is, of course, Eat24 and the coverage that Eat24 provides since I think they're 30,000-plus businesses. So, as we continue to onboard other vertical partners that cover more locations, more businesses, more categories, I think you'll continue to see really nice growth there both on the food delivery side and then beyond. And so, it's something that we're medium-term to long-term excited about. And, in fact, it was 150% growth year-over-year in transactions and that would nice to see. On the Request a Quote side, we're pretty excited about this functionality. I mean, really it represents a migration of users from doing things like clicking on a website or clicking on a phone number to find out pricing and things like that to moving it online and making it more seamless for consumers. So it's a really great feature. You imagine a consumer that is maybe looking for a mover and wants to talk to three or four of them at the same time, they could do that from the Yelp app. All those businesses can respond either via email or they can download the business owner app. And the volume we're seeing there is quite surprising. It's taken off quickly. We haven't focused on monetization. It's something that we're looking at. I would probably view it as something like incremental inventory on the ad side. But clearly, those communications are valuable and we think there will be some opportunity there.

Our next question comes from Lloyd Walmsley with Deutsche Bank. Your line is open.

Thanks. Wondering if I could follow up on that ad budget fulfillment improvement question. Is that something that you're showing up in, I guess, local ad revenue per account and is that something that you think can continue to benefit spending levels throughout the year? And, I guess, kind of follow-up on that. Is that primarily kind of unlocking budget from national advertisers or do you see the benefit of that across the customer base?

Hey, Lloyd, Geoff again. Yeah, the short answer is, it's both local and national type advertisers in this case. I think in these gains in terms of ad delivery and auto bidding is being mostly a one-time thing. We certainly would expect that level of fulfillment to more or less carry through the year, but we're not expecting incremental gains there. And fundamentally the other point is we're really just delivering more of the budget that we've already gotten from those advertisers.

Okay. And then, I guess, second if I can. Maybe you could elaborate on what some of the promotions you're running in the self-service channels and kind of why you think or why you don't plan to repeat those and kind of talk about, maybe quantify how much that drove in terms of either incremental accounts or incremental account revenue? Is that something we should be cautious not to kind of extrapolate? Any color you could share there would be great.

Sure. Yeah, thanks for the clarifying question there. It's important topics, I know many like to do kind of ARPU times accounts, and that's always a dangerous way to go since accounts is such a mix of self-serve accounts at the very lowest end. Some of them who participate in promotions along the line of: get your first $200 in Yelp advertising free. We may effectively in a case like that get zero revenue from that account, right, all the way up to accounts you spend thousands of dollars a month with us. So looking at that kind of overall ARPU is just a little bit of a dangerous exercise because there's so much averaging going on. And then yeah, the reason to mention that there was promotions involved is, in any given period, we're constantly running a variety of different promotions to bring in self-serve advertisers, some of them along the lines that I just described where we might give $100 in free advertising upfront in order to get folks on. Some of those promotions are successful, but we also find others just bring in large numbers of accounts with low ARPU. And as a result, we tend of discontinue those and then try another forms as well. So we just wouldn't want to anybody to expect that that 10,000 net increase in local advertising accounts would be something that would necessarily repeatable would be important given that a meaningful percentage of those were kind of low spending self-serve accounts.

Our next question comes from Mark May with Citi. Your line is open.

Thank you. I had one on just kind of sales force, what you've been seeing in recent months in terms of retention and hiring and what, if any, impact some of the local offices outside the Bay Area, the impact that that's had on the sales organization? And then follow-up question on your comments about national accounts. I think you said it was about 20% of the business right now. What's the growth rate look like there over the last year or so? And if you could describe a little bit how those types of arrangements differ from your traditional local arrangements? Do they tend to be longer duration, higher margin, stickier, et cetera? Thanks.

Sure. Hey, Mark. This is Geoff again. I'll try on both of your questions here. First off, on sales force hiring and retention, trends have been pretty consistent with historical averages, I would say. It's always been helpful for us to have diversification across the offices, we got four big offices now in the U.S. And so that is helpful as you see trends change from kind of one market to the other. But there is no particular trends that I would call out in the first quarter of this year, just generally hiring and retention trends have been pretty much on plan. As to your second question on national accounts, the growth rate there has been nice and yet it's been growing at kind of comparable rates. I think we've given that 20% number in the past to the overall local revenue business. And as to the question about how do those relationships differ, there is a wide range within what we think of as that national segment from State Farm at the very large end, all the way down to what we think of as mid-market accounts, which could be a local business owner who owns eight or 10 locations in a given city. And so there is a mix of arrangements there. On average, though, most are doing similar things to what local independent business owners are doing, which is a combination of an enhanced profile and then our CPC advertising package. Many of those largest accounts do focus on ROI even more so than, say, an independent local business owner. And therefore, we tend to see with that more sophisticated buyer, it does tend to be a stickier buyer than some of the independent local businesses.

Our next question comes from Douglas Anmuth with JPMorgan. Your line is open.

Thanks for taking the question. I just wanted to follow-up on the sales force questions from Mark and just in particular, can you just talk about the local strength in 1Q and to what degree was that a function of some of those sales force hires, the step-up that you saw in the back half of last year, the productivity increasing among those specific sellers? And then secondly, you said you're on plan for the year, and I think you said 20% to 30% is where you had been targeting sales force growth before with the front half loaded and you did 40% here. Is that still the case 20% to 30% for the year? Thanks.

Hey, Douglas. Okay, so on sales force performance, it was a good quarter for the sales team. Important to note that sales team performance in any quarter is actually a relatively small percentage of the overall quarter performance given how important overall recurring revenue is to the business. That having been said, it was a strong quarter that wasn't necessarily driven by any kind of uptick in productivity. Productivity on the sales force level is pretty predictable or has been pretty predictable and consisted with past couple of years in terms of the sales force by tenure level. As to the question on sales force growth, yes, we're still expecting 20% to 30% overall growth on the sales team for this year.

Great. Thank you.

Sure.

Our next question comes from Matthew Thornton with SunTrust. Your line is open.

Yeah, thanks. Hey guys, and Rob, absolute best of luck. I guess, one for Rob here, I guess. The EBITDA guide for the full year was raised a little, nice and strong. But given the step-up in marketing spend expected for the year and the shuttering of the brand business, obviously it implies a pretty nice incremental margin. So, I guess, the question is, are there savings elsewhere maybe that we're not kind of factoring into the model or is there any change to that $20 million in incremental marketing spend that you're expecting for the full year?

Hey, thanks, Matt. I appreciate that. So, as far as the marketing spend, there's really at this point, we don't – we'd given out I think at the beginning of the year that we've said we'd spend about $50 million, and we'll spend no more than that in 2016. So there's really no expectation change on that. The only thing I would say is it's a little bit more frontend weighted than backend. And so, on the EBITDA guide, we do expect continued leverage. We've given out Q2 guidance that's showing almost a doubling of what we experienced in first quarter. So we feel good. We feel like we're on track. We do feel like obviously it's backend weighted. So we didn't pass through the over-performance in Q1, it was only $1 million anyway, less than 1%. So we feel like we're on track to hit that.

Our next question comes from Kevin Kopelman with Cowen & Company. Your line is open. Kevin Kopelman - Cowen & Co. LLC: Hi. Thanks a lot. So first just a follow-up on promotional – the promotional channel. So I know it sounds like those are lower ARPU accounts, but what role did those have in kind of acceleration in the quarter as we're thinking about that going forward? And then just totally separately, can you help us with Eat24, what pro forma growth was and how that kind of looks? And then lastly, other revenue was down a little bit, anything in particular there? Thanks.

Hey, Kevin. It's Geoff. I'll take your first question. I think Rob will take your second two there. So you asked about the promotional channel, and let me say at the higher level, self-serve accounts are an important minority of the business at this point in terms of local revenue business. Promotions in and of themselves, though, while a nice driver of self-serve activity turned out to be kind of rounding error in terms of the overall local advertising business at this point. Certainly an interesting area of experimentation for us, and we can see it playing an interesting role a couple years down the line, but right now not a meaningful portion of the business.

Hey, Kevin. It's Rob. So on Eat24, last year we broke out Eat24 to help people understand and give context for why we bought that company and how much of integration has helped both their business and ours on the transaction end. So a lot of revenue synergies, we definitely saw that last year. I think that's definitely continued. We have included that, as we did in the prior year in transaction revenue. We're not breaking out individual line items of business. But I think you could do some math to figure out where it's coming from, obviously a pretty big growth rate on the transaction end. As far as – I think you said other revenue for the remainder of the year, or why the underperformance in Q1. It was off by I think $0.5 million or so in Q1. And other revenue represents the partnerships that we have with a variety of different partners, and so we get revenue in varying degrees. And so a partner can drop out or various different things can happen, so it's a pretty small number. We would expect that that other revenue to be fairly consistent for the rest of the year.

Our next question comes from Peter Stabler with Wells Fargo. Your line is open.

Hi. Thanks for taking the questions. I got a couple. First of all for Geoff, could you tell us what percent of local ad contracts in the quarter were being served on an impression basis? I know you are migrating the business to CPC, but I'm guessing that you have some legacy impression-based contracts. So kind of the share between impression-based and CPC-based. And then secondly, we've noticed an increase on business pages of competitive advertising units, just wondering if that is widespread, and kind of generally can you talk about ad load in terms of ad units per page served, and what kind of impact that's having on click-through rates? Thanks so much.

Hey, Peter. Thanks for the questions there. So first off, CPC, we're no longer breaking out that specific mix. We were sharing that for a while because that transition was so interesting and important to the business. Effectively that shift is over now. We certainly do have some legacy CPM advertisers now, and that's an important minority, but a shrinking one. At this point, we are really fully selling CPC and have been now for well a year. And so for all intents and purposes, all new accounts come in with CPC we're advertising, and a meaningful percentage even of our recurring base from prior period have converted over to CPC now. So in a lot of ways, the shift is over and all for the good. As to the question about ad load, really nothing new to report there. The team is constantly experimenting with different forms of ad delivery and targeting to make sure that we're serving up relevant ads wherever possible and also maximizing RPM on those pages. So I'm not sure exactly what you guys have noticed there, but no major shifts to speak of.

Thanks, Geoff.

Thanks.

Our next question comes from Brian Fitzgerald with Jefferies. Your line is open.

Thanks, guys. When you look at the local services category, when you look at local and general, it seems very fragmented and competitive. There's a lot of players that are kind of buying for the ability to not only market for these local services and SMBs, but to actually get a piece of the transaction. And, I guess, our question is, do you feel that you need a horizontally integrated stack here so you can offer both the advertising, the marketing, the loop formats, the booking, maybe a payment option and a CRM service. Is that important having a horizontal suite or is it more the breadth and scale of your relationship with these local vendors?

Sure. I guess, I'll take a stab at that one. I think there is a variety of different related services that we can provide and I think we'll continue to offer a number of different things and then for each potential customers, they'll pick and choose the ones that really make sense for their business. So, in some cases, we may have a transaction offering, whether that's homegrown like a CE or a different partner that we go out there and sign up. Another example is Request a Quote or Message the Business like that could be useful channel for local business, if they choose to engage with it. Others may just want additional exposure and therefore CPC is the product for them, and there could also then be a combination of multiple of those. And so I think over time that's what we'd expect is to continue building out the various services that allow greater exposure for great local businesses and then allows them to move that customer that's browsing into an actual buyer and down the funnel through either starting a conversation with them or actually transacting, involving payments and so forth. So we see all of the steps, the funnel is important and things that we can actually do on Yelp.

Great. Thanks, guys.

Our next question comes from Youssef Squali with Cantor Fitzgerald. Your line is open.

Thank you very much. Two questions, please. I guess, the first is around just national accounts. You said earlier how national accounts are more – in a way more ROI focused than the smaller accounts. So, as you focus more on that segment of the market, I was just wondering if you feel that the measurement analytics tools that you have right now are adequate, whether you still have a hole there that you need to fill that would ultimately maybe cause that segment to see maybe an acceleration in growth. And then on the local advertising accounts, if you were to normalize for the promotion that helped you drive the self-serve accounts. I think if I look at the last five or six quarters, I think you've averaged about plus 6,000, last quarter you averaged 10,000. Is it just fair to assume that that extra 3,000 or 4,000 was driven by these promotions and so normalized for that, the growth rate was relatively consistent? Thanks.

Youssef, thanks for your questions. First off, on the national buyer and our ROI tools, yeah, in fact, in the last few months, we've introduced a number of new product features for national buyers that I think have been helpful to the business. I'd say we're still on our early innings in terms of providing the right level of product support for that sophisticated national buyer. But we have done a number of things to improve the experience for them. For instance, one of the things that we introduced was a multi-payer capability such that clients like State Farm can actually go ahead and pay part of the budget for a franchisee themselves through national fund, but then also the franchisee can go ahead and increase that spend on their own in order to buy more clicks and so on. So that's an important capability. We also did introduce a better version of the multi-location dashboard so that – again, in the example of State Farm, they can go ahead and see across a number of different locations how their advertising is performing. Still early innings, but some nice improvements there already. As to any particular milestone or product out there, I don't think there's any one product introduction that's going to be a step function change in this business, but it will be kind of a long slow build to continue to provide the right set of tools for them. Then as to the question on promotions, there's always been a mix of self-serve and full-serve since we went public in that local advertising account number, which is why internally although we measure it and occasionally look at it and share it externally, it's really not a measure that we're driving towards internally or that anybody is commissioned on. The sales team and we overall are really focused on local revenue, which is fundamentally the important thing. And so these promotions are interesting and it's certainly valuable to introduce the business to new local businesses and self-serve accounts, but that's not a number that we put a lot of stock in.

Our next question comes from Ron Josey with JMP Securities. Your line is open.

Hi. This is Shweta for Ron. I had a question on mobile apps. They grew 32% year-over-year and you've mentioned in the past 10 times more engaged for mobile app users than web. Could you talk about your efforts around increasing engagement on apps and how that's tracking? Thanks.

Sure. This is Jeremy. Yeah, so we grew mobile app usage 32% year-over-year, we feel really good about that. And the more users we're able to migrate over from web, from our view, the better. They tend to be significantly more engaged and we like that. We have a one-on-one relationship with that user. So instead of going through an intermediary, also known as Google, we actually get to be on somebody's phone and that also leads to better user sign-ups and 70% of our page views are actually now coming from these apps. We continue to spend a lot of effort trying to devise ways to increase contributions as well as return visits, looking at functionality like showcasing hot new businesses and alerting users to push notifications with helpful information. Those are all things that we're looking at and so we'll continue to tune those numbers over the year.

Great. Thanks.

Our next question comes from Rob Sanderson with MKM Partners. Your line is open.

Yeah. Thank you. I wanted to go back to the productivity questions. Can you remind us what the productivity ramp for a new hire typically looks like and how long does productivity take to ramp to a fully tenured level? Or anything about the steps along the way, like the second six months of a new rep versus the first six months. Just can you give us a sense of what the renewed vigor in the net sales number that you're reporting, just how that flows through in terms of the productivity curve as we model going forward. And then I have a follow-up after that.

Hey, Rob. One of the things we've said in the past about the local sales rep on average is that it takes about six to nine months to be kind of veteran-level productivity or kind of fully productive, if you will. One of the slides that's in the investor deck that you've seen before shows contribution margin over time. And one of the things you can see, and that's on a loaded basis, is that for when we acquire a new local advertising account on a blended basis, including churn in that segment as well as in the sales force, we are still getting about $2 back for every dollar we invest in the first year. Of course, in the second and third year, that margin is a whole lot higher at about 95% contribution margin. But again, even in that first year, it's about two-to-one even including all the ramp-up time with the sales force given that new people is such an important part of building the sales force.

That's helpful. Then a question on engagement. App growth of 32%, that's a good number, but 29 million app users, it's probably only about a quarter of your total mobile uniques and that's significantly under-indexed versus many of your peers. So what can you do and what are you doing to grow that even faster than 32% and bring that proportion up higher? Obviously, it's a focus, but like to learn a little bit more about your efforts there. And then just a housekeeping. The data sheet says number of searches on mobile is 70%, the script said page views from app were 70%. Are these metrics synonymous or just coincidental that they are both 70%?

They're coincidental.

Yeah. And on the – this is Jeremy taking the app engagement question and reach. When we look at it, based on our measures, we're at about 30% reach in the U.S. So we feel like there is significant upside, although we're quite proud of where we are. I think if you look at top 20 comScore properties, we make that list now. But we're going to continue to invest there, obviously. We have marketing efforts, which contributes. But really how I think about it is we still have a tremendous web footprint both on desktop and mobile, and that's like having several Super Bowl commercials every month that allow us to educate people about our app and give them a better experience. And when they do move over, they are about five times more engaged. So even though that number is smaller than our very, very large web reach, those users are driving, obviously, disproportionate engagement.

Our next question comes from Ken Sena with Evercore. Your line is open.

Hi. Just maybe a question on competition. We're seeing a lot of efforts from Google, from Facebook, and others in local. You mentioned that your sales head count has increased 40%, kind of consistent with your increase in local revenues, but it does seem like there's a wage increase on there too based on your total revenue increase, I guess, about 12% or so. But as some of these other players come into the local space, are you seeing any upward wage pressure at this point? Even assuming that the 20% to 30% head count guidance that you had given for the full year kind of stays sort of in place? Is there an opportunity – basically what I'm asking is, is there an opportunity to see some sales leverage as we look out to the back half? And if so, can you help us get our heads around that? Thank you.

Hi, Ken. Yeah, it's interesting. You tied together competition with possible wage pressure there, and we're not really seeing that at this time. If anything, I would say that those big competitors you described, Facebook and Google, don't really have sales forces of the kind that we have. And as a result, there's just really not a direct competitive situation there. As to long-term sales leverage, I think the most obvious thing you'd see in the long term is that to the extent that growth rate slow of our sales force, then almost definitionally you'll see leverage there in that part of the business. In the near term, though, we are continuing to try to grow the sales force at as quick a rate as we can reasonably support, and that's the kind of 20% to 30% that we are forecasting for this year.

Yeah. And Ken, this is Rob. I think in the first half of this year, obviously, given the overall growth rate for the year, we're projecting of about 20% to 30%. It's going to be higher in the first half of the year than the back half. So we will see that leverage ramp over the year. And one of the things is, I guess, if you look at last year from a comp standpoint, when you comp the first half of last year where we lost a lot of people, obviously, as we hire in the first half, we're benefiting from that. So it looks a little higher. And that's why in the back half of the year, it will look pretty moderated, and then obviously, I guess, it gets fairly tremendous leverage out of that. That's why we're projecting second half EBITDA weighting and specifically into Q4.

Got it. Thank you very much.

Our next question comes from John Egbert with Stifel. Your line is open. John Egbert - Stifel, Nicolaus & Co., Inc.: Thanks for taking the question. Do you have a feel for the proportion of brand advertising dollars that might have migrated over into local ad dollars after you shutter the business in 4Q? And just a follow-up on that, on how you categories revenues. We've been testing some search queries on Yelp with our location tagged since the beginning of the year. And we noticed some non-local businesses are making their way into the right hand rail ads, where it says ads by Google. So I was wondering if that's categorized somewhere different, businesses that actually won't deliver to Manhattan when we're searching for Manhattan, and would those maybe show up in the other revenue line or how would you categorize those? Thanks.

Hi, John. First question was the kind of brand-dot-ad dollars. While I don't have a specific number for you there, my sense is that would be de minimis, that most of the brand and display advertising revenue that we got in 2015 and previous really was coming through ad agencies, and it was a different kind of spend than what we tend to get on the local advertising side. And so we're happy with that 40% local advertising growth rate, and we don't really think that any of it specifically came from kind of a brand migration, from the same set of customers. And then as to the question about the right rail and kind of those AdSense ads that you see sometimes, that did show up in other revenue, and there's all kinds of stuff that shows up there. And as you know, that's programmatic as well, it's just coming from specific advertising targeting on Google. John Egbert - Stifel, Nicolaus & Co., Inc.: Thanks.

Our next question comes from Jason Helfstein with Oppenheimer. Your line is open. Jason Helfstein - Oppenheimer & Co., Inc. (Broker): Hi. Thanks. Two quick ones. Anything you could share as far as user engagement, meaning like minutes per visitor on any of the metrics, just so we can kind of understand engagement going up or not, et cetera. Secondly, on transaction revenue, it was up 4% sequentially. What's the right way to think about the outlook for the rest of the year, and is there a metric that that would track? So just any help there. Thanks.

I guess, I'll take the first one here, on the user engagement side. I mean, the main metric that I can share is the delta between what we see on the web and what we see on the app. And so as we're moving users from the web to the app, I actually misspoke earlier, I said it was 5x, it's actually 10x. So the activity, the searches, those type of things, page views is about 10x, when you get a mobile user converted over to a mobile app user.

And on the second part of the question about transaction revenue and how – is there a metric to track. There's not really specifically a metric to track as how we look at it. I mean, there is actually transactions, and we said that on the platform itself, which is up 150%, and then there is the Eat24 business, which obviously is driven by orders, which we're not specifically breaking out. But you can imagine that throughout the year, that's going to grow at a fairly healthy rate. I mean, I know you said 4% quarter-on-quarter, but a pretty big jump from last year. And just I will call out that last year we acquired Eat24, say, mid-February and so there is some benefit that we're getting as a result of that. But it's still growing at a very healthy rate and that's what we are anticipating for the rest of the year. Jason Helfstein - Oppenheimer & Co., Inc. (Broker): Thank you.

Our final question comes from Kerry Rice with Needham. Your line is open. Kerry Rice - Needham & Co. LLC: Thanks a lot. Thanks for squeezing me in. Maybe back to the earlier part of the call when you talked about ad fulfillment, ad delivery, and ad bidding improvements. You highlighted at least ad targeting improvements. I was curious if that was coming from any of the closed loop data you're getting from transaction. So we're starting to see – if we're starting to see that build into that and push your ad revenue up. And then, one question on advertising, your incremental spend there. How much did you spend in the quarter, if you can disclose, and if there's any additional learnings, any new channels that you found were stronger than others or just any other color there? Thank you.

Sure. Hi, Kerry. Geoff. So, first off, on ad targeting and the budget fulfillment, there are a number of different factors that are going into ad targeting and the team is constantly experimenting with that. To my knowledge, transaction data actually hasn't been one of the things on which they've been targeting users to this point. And so it's certainly an opportunity for the longer term, but to my knowledge, it's not something that they're focused on to-date. As to our advertising and advertising that we do, we spent about $13 million in marketing in the quarter, which is footing still to that $50 million sort of general target that we gave for the year. The bulk of that was spent on television advertising, which we have found to continue to be very productive in driving overall unaided brand awareness, consideration and familiarity with the brand, which turn out to be at all-time highs. But it also does include other channels, for instance, some of the promotions that I mentioned for CPC advertising and actually acquiring business customers. It also includes marketing for our Eat24 and SeatMe businesses. So all those things are kind of rolling into that $13 million marketing line. Kerry Rice - Needham & Co. LLC: Thank you.

Thanks.

Thank you, ladies and gentlemen. This concludes today's conference. Thank you for participating. You may now disconnect.