Interactive Brokers Group, Inc. (NASDAQ: IBKR) Q2 2022 earnings call dated Jul. 19, 2022
Corporate Participants:
Nancy Stuebe — Investor Relations
Paul J. Brody — Chief Financial Officer
Thomas Peterffy — Chairman of the Board of Directors
Milan Galik — Chief Executive Officer, President and Director
Analysts:
Richard Repetto — Piper Sandler Companies — Analyst
June Subin — Jefferies Group LLC — Analyst
Kyle Voigt — Keefe , Bruyette & Woods , Inc. — Analyst
Craig Siegenthaler — Bank of America Merrill Lynch — Analyst
Ryan Bailey — Goldman Sachs Group, Inc. — Analyst
Presentation:
Operator
Thank you for standing by, and welcome to the Interactive Brokers Group Second Quarter 2022 Earnings Call. [Operator instructions] As a reminder, today’s program may be recorded.
I would now like to introduce your host for today’s program, Nancy Stuebe, Director of Investor Relations. Please go ahead.
Nancy Stuebe — Investor Relations
Thank you. Good afternoon and thank you for joining us for our second quarter 2022 earnings conference call. Once again, Thomas is on the call but has asked me to present his comments on the business. Also joining us today are Milan Galik, our CEO; and Paul Brody, our CFO.
After prepared remarks, we will have a Q&A. As a reminder, today’s call may include forward-looking statements which represent the company’s belief regarding future events, which by their nature, are not certain and are outside of the company’s control. Our actual results and financial condition may differ, possibly materially, from what is indicated in these forward-looking statements. We ask that you refer to disclaimers in our press release.
You should also review a description of risk factors contained in our financial reports filed with the SEC. I will start today’s call with the bad news. In the first half of 2022, circumstances did not evolve in our favor. First, starting at the end of last year, activity diminished in Asia because of China’s crackdown on large privately owned companies and many of our clients from that region suffered outsized losses.
Then late in the first quarter, the impact of the war in Ukraine began to be felt on the European economy, showing the mood of our customers in that region. Finally, early in the second quarter, the delayed response by the Fed to inflationary pressures created fears of a recession in the U.S., sending prices into bear market territory. Deficit spending in the U.S. has limited the government’s ability to respond to rising inflation with increasingly higher interest rates. As for each 1% hike, interest on U.S. debt increases by $300 billion as it gets refinanced.
So, inflation is likely to stay with us, the same difficulty in raising rates in the face of higher inflation and the same causes are also occurring in Europe. Customer losses in their accounts in the markets were substantial. Adding to that, the impact of the withdrawal of all funded accounts by Futu to their own new clearing firm and an introducing broker using a custodial bank while still executing with us, our customers’ funds diminished by about $80 billion over the past two quarters. In addition, our net new account openings plummeted by about 40% by the end of the quarter.
On a brighter note, now for the good news. It seems that many large global financial institutions are looking at the other side of this market valley and are beginning to focus on their clients’ trading needs. These clients more and more often want to run globally diversified portfolios heavily weighted toward U.S. equities no matter where they live. Satisfying that demand would necessitate that they consolidate worldwide they’re often separately and locally developed technology and operations. Several such institutions believe that they can get there sooner by putting their clients in IBKR’s platform now and begin working on developing the tools to serve their unique specific client financial needs better.
IBKR has reached a positive conclusion in several such discussions. These institutions will onboard their clients gradually and separately by type and location, beginning later in the third quarter, while others will start later this year and next. These will be introducing broker accounts and thus they will add to our number of accounts. It is for this reason that in spite of our number of net new account openings having declined by 40% by the end of the quarter, I expect this drop to be temporary as the new introducing brokers accounts will begin to show up. Accordingly, I still project long-term account growth of 30%. Most of our technology development capacity in the near future will be devoted to building systems that make our introducing broker and worldwide RIA platform even more compelling.
With this backdrop, we are pleased with how our business performed. We ended the quarter with a record 1,923,000 accounts, a net increase of 36% from last June. We saw account growth in all client segments in all geographic regions, with particular strength 49% and 38% in Europe and Asia, which together represent the majority of our accounts. As our client base grows, DARTs have risen as well. Second quarter total DARTs were strong at over 2.1 million.
While trading in the U.S. seems to be holding steady, we began seeing some easing of trading activity in Europe and Asia due to declining markets. Commission per DART rose due to product mix as volumes continue to be strong in futures and options, which carry a higher commission. While in equities, higher commissions per DART were from more active trading and higher-priced stocks which helped boost commissions over last year. Higher futures commissions include very high exchange and regulatory fees, which in part explain our higher execution and clearing direct expense.
Higher DARTs and commission per trade led to our total commission revenues rising to $322 million, the third highest in company history and behind only the unusually active trading periods in the first quarters of this year and last. Options and futures volumes continue to be strong. In the second quarter, in the U.S., listed options volume for the industry saw average daily volume of nearly 40 million contracts, one of the highest on record and up 8%. Interactive Brokers options volumes were even stronger, up 11%.
Our future business was even better with our contract volumes up 46% over last year, nearly twice the 25% increase in industry volumes. As inflation can lead to higher commodities prices, investors often use commodity futures to participate, especially when there’s also volatility in the market. Interactive Brokers has become better at offering our customers new and innovative products, while also enabling them to navigate through our many high-quality features an ever-greater efficiency, helping them to establish their own personalized work environments and tools. Superior customer experience, our platform offers continues to be spread by word of mouth as well as by our institutional sales team.
In uncertain markets, the quality of our capital base matters. Our capital base grew even stronger during this period with total equity reaching $10.6 billion this quarter. This base funds our business in countries around the world, helps us to attract larger customers, and reassures clients looking to participate in the markets. We saw account growth once again in all five of the client types that we service. Individual account growth was fastest at 44% followed by proprietary traders of 32%, introducing brokers at 24%, financial advisors at 15% and hedge funds at 10%.
We are always looking to find opportunities and grow our business. We continue to place enhanced focus on our marketing efforts, and we have increased spending in this area from last year. We are letting investors know that Interactive Brokers pays its clients over 1.08% on their cash balances. And if the Federal Reserve raises rates by 75 basis points, then their rate will also rise by 75 basis points to 1.83%. We recently introduced fractional trading in European stocks, so our clients can purchase as little as $1 of almost any U.S. or European stock. And in the UK, you can now open a stocks and shares ISA.
We continue to add to the functionality of our IMPACT app. We recently added the ability to offset a selection of specific carbon emitting activities giving clients the ability to offset their footprint and keep track in their statements, all from their IBKR account. We still see higher inflation as a catalyst that convinces more people that holding on to their money as cash is a losing proposition.
Investing in equities worldwide will be necessary to earn a return and Interactive Brokers will be there with our innovative platform and educational materials. We aim to be the platform of choice for the best informed, most successful investors, and we look forward to welcoming our 2 millionth customer in the next few months.
With that, I will turn the call over to our CFO, Paul Brody, who will go through our numbers for the quarter. Paul?
Paul J. Brody — Chief Financial Officer
Thanks, Nancy. Thanks, everyone, for joining the call. I will review the second quarter operating results, and then we’ll open it up for questions. Starting with our revenue items on page 3 of the release; we recorded another strong quarter with increases in net revenues and pre-tax income on an adjusted basis. With customer account growth at 36% year over year, we are expanding our potential for both commission and interest revenues in the future. Commissions were strong, reaching their third highest quarterly revenue ever, at $322 million.
Options and futures volumes outpaced the second quarter of 2021, and while stock share volumes declined from last year’s quarter, notional value of stock trades actually rose. Net interest income of $348 million reflected higher margin loan interest despite relatively unchanged balances, thanks to increases in benchmark rates and higher interest earned on our segregated cash portfolio as U.S. rates have moved from an average effective rate of 7 basis points last year to 77 basis points in this year’s quarter. These gains were partially offset by higher interest we paid on customer credit balances as we pass through rate hikes above 50 basis points to our customers on their qualified funds.
Other fees and services generated $43 million with market data fees of $19 million, down 5% and risk exposure fee revenue of $6 million, down 14%. Options exchange liquidity payments $9 million were even with the prior year. Declines in IPO fees and especially in account activity fees which were discontinued after the second quarter of 2021, reduced the total in this line item. Other income includes gains and losses on our investments, our currency diversification strategy and principal transactions. Note that many of these noncore items are excluded in our adjusted earnings.
And without these excluded items, other income was positive $4 million for the quarter. Turning to expenses; execution, clearing and distribution costs rose 43% from last year led by strong futures volumes, which carry higher fees, lower exchange liquidity rebates and a smaller clearing fee rebate than in last year’s second quarter. As a percent of commission revenues, execution and clearing costs, which are driven by a combination of trading volume, exchange rebates and changing fee schedules were 18% this quarter, meaning 82% of incremental commission revenue dropped to the bottom line.
While this cost ratio fluctuates over time with product mix and trading volumes, the factors that tend to drive it lower over time remain in place with the exchanges offering liquidity rebates and competing on costs, which gives our Smart Router the opportunity to improve on execution quality for our IBKR Pro clients. Compensation and benefits expense, while up in dollar terms for the quarter as we continued to expand hiring to support our strong growth was 16% of our adjusted net revenues consistent with the historical level. Our head count at quarter end was 2,780. G&A expenses were up $7 million versus last year on increases in advertising, legal expenses and administrative fees.
Our adjusted pre-tax margin was a robust 63%. Automation remains our key means of maintaining high margins as well as continued expense control while we hire talented people and invest in the future of our business. $32 million of income taxes reflect the sum of the operating company’s $16 million and the public company’s $16 million. Moving to our balance sheet on page 5 of the release; our total assets were $113 billion at the end of the quarter with growth over the last year, driven by increases in our segregated cash and securities partially offset by a reduction in customer margin loans.
Our consolidated equity capital was $10.6 billion, and we have no long-term debt. In our operating data, on pages 6 and 7, our contract volumes for all customers were strong, up 11% on the year in options and the second highest ever in futures, up 46%. Stock share volume was down significantly versus last year’s active second quarter, and the drop-off was largely attributable to trading in pink sheet and other very low-priced stocks. Of note, the notional value of shares traded actually increased over the prior year, reflecting a shift toward trading higher-priced stocks, which tends to raise the average commission per order.
On page 7, you can see that our account growth remains robust with over 114,000 net accounts added in the quarter and total accounts reaching 1.9 million, up 36% over the prior year. Total customer DARTs were just under 2.2 million trades per day, down 6% from the strong prior year quarter. Our cleared IBKR Pro customers paid an average of $2.74 commission per cleared commissionable order, up 15% from last year as our clients’ volume mix included higher per order contributions from stocks and options. Page 8 of the release presents our net interest margin numbers.
Total GAAP net interest income was $348 million for the quarter, up 27% on the year ago quarter, reflecting stronger margin loan and segregated cash interest, partially offset by higher interest expense on customer cash balances. The Federal Reserve raised interest rates twice in the quarter by 50 basis points in early May and by a further 75 points in June with about two weeks left in the quarter. The latter raise had a minor positive impact in a 12-week quarter, but of course, we’ll have a full positive impact in the third quarter. Other regions also raised rates this quarter.
This group includes the UK, Canada, Australia and Hong Kong. Margin loan interest was up 54% to $197 million despite average margin loan balances relatively unchanged from last year’s second quarter. Higher rates in the U.S. and internationally bode well for our margin interest income. Net interest on segregated cash turned positive in the first quarter. And in the second quarter, we earned $53 million on these balances, primarily due to the two Federal Reserve rate hikes but also to our managing to short duration on invested funds.
At June 30, our U.S. portfolio duration was 45 days, so the investments roll over into new higher rates with a fairly short lag time. Securities lending net interest was $116 million, down from the $136 million in the active year ago quarter, although revenue opportunities on hard-to-borrow stocks trended up during the quarter. It’s worth noting that while securities lending opportunities maintain a strong pace, it is also the case that as benchmark rates rise, a greater portion of the revenue generated by securities lending is reflected in interest on segregated cash because the cash collateral received is invested as segregated funds.
We estimate this impact to be about $10 million for the quarter. Interest on customer credit balances or the interest we pay our customers is returning to its historical norm as higher rates in many currencies result in our paying interest as we pass through rate increases. We paid $37 million to our customers on these balances in the second quarter.
Now for our estimates of the impact of increases in rates, given market expectations more rate hikes to come, we estimate the effects of increases in the Fed funds rate to produce additional annual net interest income as follows: at 25 basis points, an increase of $57 million annually; at 50 basis points, an increase of $115 million; at 75 basis points, an increase of $172 million; and at 100 basis points, an increase of $229 million. Note that our starting point for these estimates is June 30, with the Fed funds effective rate at 1.58% and also based on balances at that date.
These estimates do not take into account any change in how we may adjust our investment strategy or take advantage of newly higher rates or any change in our assets. About 21% of our customer segregated cash is not in U.S. dollar. So, estimates of U.S. rate change impact exclude those currencies. We estimate a 25 basis point increase in all the relevant non-USD benchmark rates would produce additional annual net interest income of about $10 million and that rising to about $40 million at a full 100 basis point increase.
In conclusion, we put forward another solid performance in the second quarter, reflecting our continued ability to grow our customer base, deliver on our core services to customers while continuously adding new features and products and manage the business effectively with strong expense control.
With that, we’ll now open up the line for questions.
Questions and Answers:
Operator
Certainly. [Operator instructions] Our first question comes from the line of Rich Repetto from Piper Sandler. Your question, please?
Richard Repetto — Piper Sandler Companies — Analyst
My question is a follow-up on the prepared remarks and the account growth that you expect in the back half of the year, I guess, Thomas, could you give us some more detail on the arrangements that you have? And how will that — will it — will we still see the same — how will that run through, I guess? I’m trying to figure out like we normally model close to your 30%, but if it’s going to come in chunks or what do you foresee for the more detail on the account growth?
Thomas Peterffy — Chairman of the Board of Directors
So, as I said, the current account growth is roughly 40% below our average growth over, say, the last year. And this new type of accounts will start kicking in very, very late this quarter and then gradually more and more of them through the first quarter of next year.
Richard Repetto — Piper Sandler Companies — Analyst
So, do you think that it will sort of bridge a little bit of that gap toward the?
Thomas Peterffy — Chairman of the Board of Directors
What happened was that when the market collapsed in June, it was, right? Yes. So — or late May, I don’t know when they’re — terrible. Since that time, the new account fundings are way down, right? And that seems to be continuing strangely. And so, I can’t really say what will happen with the existing type of business other than to project forward. But what is going on right now, which is a lower level of account fundings of say about 15% growth, and I expect this new type of accounts to — as I said, to begin coming in very late this quarter and then continuing and gaining speed as we go into next year.
Richard Repetto — Piper Sandler Companies — Analyst
Got it. Okay. And then my follow-up question would be, you have brought on a lot of accounts over the past 1.5 years to two years. And I’m just trying to — do you see — we see the average trades per comp down, but we also see the commission rising because the trades that I’ve done, there’s more of a mix of futures and options. So, I guess the question is, these accounts, the large number you brought in, how do you view the quality of the account? And do you expect — do you still expect like the season and to mature and trade more actively over time or is there different type that’s been brought on?
Thomas Peterffy — Chairman of the Board of Directors
So, as you know, we have basically five types of accounts. And the newer individual accounts tend to be smaller, but the other accounts — and then your introducing broker accounts tend to be smaller and less productive, but the hedge funds, stock traders and financial advisors are concerned, they are basically the same. So, to the extent that our growth is more pronounced among individual accounts and introducing brokers, yes, overall, the new accounts are less productive than the old ones.
Richard Repetto — Piper Sandler Companies — Analyst
Understood. That’s all I had. Have a good evening, Thomas.
Thomas Peterffy — Chairman of the Board of Directors
Thank you.
Operator
Thank you. [Operator instructions] And our next question comes from the line of Daniel Fannon from Jefferies. Your question, please?
June Subin — Jefferies Group LLC — Analyst
Hey, good afternoon guys. This is actually June Subin [Phonetic] in for Dan. Just wanted to ask with the recent high in interest rates and the prospect of sort of more to come, how are you guys thinking about sort of the duration and the makeup of your investment portfolio and to kind of like generate higher returns?
Thomas Peterffy — Chairman of the Board of Directors
No, we are not. That’s the kind of risk that we do not want to take. We will continue to invest in T bills and repos.
June Subin — Jefferies Group LLC — Analyst
Understood. Okay. And then just to confirm, the sort of 21% cash that oversees the investment philosophy on that front is pretty consistent with the U.S. counterpart. Is that right?
Paul J. Brody — Chief Financial Officer
Yes, in particular, outside the U.S., we are more — even more constrained to putting client money in banks. We use very large the largest of the international banks. But primarily, those are the only investments we’re permitted to make currently.
June Subin — Jefferies Group LLC — Analyst
That’s helpful. Thank you.
Operator
Thank you. [Operator instructions] And our next question comes from the line of Kyle Voigt from KBW. Your question, please?
Kyle Voigt — Keefe , Bruyette & Woods , Inc. — Analyst
Hi. Thank you. So, with 79% of the cash balances in U.S. dollar, I would have expected a bit higher yield on your said cash balances in the quarter. I just want to confirm whether there’s some lag effect from rising U.S. rates, given that 45-day duration that you disclosed. Paul, if you just could confirm that or not if we’re kind of yet to see some of the benefit from the Futu rate hikes come through maybe in the third quarter.
Paul J. Brody — Chief Financial Officer
Yeah, sure. I mean that is the 45-day lag, which is why we try to put it out there, so you have the proper expectation of the rollover rate. But yes, given that rates most recently increased in May and June, the full effect has not been felt. We have not recorded the full effect yet. And then, of course, the market is projecting further rate increases. And so, you can probably assume that our lag time will stay relatively constant.
Kyle Voigt — Keefe , Bruyette & Woods , Inc. — Analyst
And just to — maybe I’m oversimplifying it, but if you were at a zero-day duration or investing just in overnight, you mentioned average Fed funds in the U.S. was 77 basis points in the second quarter. If we assume that 79% of those cash balances were earned at 77 basis points, you get to something like a 60-basis point yield for 2Q. So, it’s a pretty big variance. So that entire variance between kind of the math that I just ran through, that 60 basis points and the 42 basis points, it’s just that 45-day duration kind of mismatch with the math that I just ran through. Is that fair? Just want to make sure that we’re kind of modeling that set cash yield correctly on a go-forward basis.
Thomas Peterffy — Chairman of the Board of Directors
Yeah. But you have to include what we’re paying to the customers, right? You’re including that, right?
Kyle Voigt — Keefe , Bruyette & Woods , Inc. — Analyst
Yeah. I’m just talking about the Fed cash yield specifically, so not the credit.
Thomas Peterffy — Chairman of the Board of Directors
Yeah. But if you look at the total balance, we also pay to customers. So that reduces the rate.
Paul J. Brody — Chief Financial Officer
So about 20-something percent low 20s are actually fully interest rate sensitive, meaning that we fall into categories or account sizes that we don’t pay interest on. So, we get the full benefit of the rate increases on that portion. Now the interest rates are sufficiently positive in the U.S., we passed through all of the additional rate increases, except on those small balance.
Kyle Voigt — Keefe , Bruyette & Woods , Inc. — Analyst
Okay. And sorry if I missed an explanation on this in the prepared remarks, but just the other fees and services revenues, I think, were down in the quarter sequentially and year over year. So, I don’t know if you could provide a bit more color on that. I know there’s a lot of things that go into that line like risk exposure fees and order flow income account — market data fees, etc. So just want to know if this is kind of a new run rate or whether or not we should see a bounce back heading into the third quarter.
Paul J. Brody — Chief Financial Officer
Right. So, the primary factor that went down was where the account activity fees because we discontinued them mid-last year. So, you would not expect to see those. Those were $9 million in the last year quarter and $1 million in this quarter. That’s a policy change. I don’t expect that to bounce back. The other changes were quite a bit smaller, small changes in market data, small changes in exposure fees.
Kyle Voigt — Keefe , Bruyette & Woods , Inc. — Analyst
But I guess the — I think the line declined about $10 million sequentially from $53 million to $43 million. And I guess that is related to related to more.
Paul J. Brody — Chief Financial Officer
Right. Sequentially, the largest factor was actually a drop in the exposure fees. But remember how we think about exposure fees, they’re there to help us influence the customers to take less risk in specific ways. We run lots of stress tests that look at different scenarios. And when we find certain kinds of risk that we feel that the standard margin amounts requirements may not be covering in a stress scenario, our system automatically charges exposure fees which the customer can then decide either to keep the position on and pay the exposure fees to us to there on overnight position or trim the risk on the position and avoid the exposure fee. So we’re not unhappy to see the exposure fees go down because that means we’re taking somewhat less risk, and that makes us more comfortable.
Kyle Voigt — Keefe , Bruyette & Woods , Inc. — Analyst
Understood. And last question for me, and I’ll jump back in the queue was just really around the execution and clearing fees. They were up 8% sequentially, while your commission revenues were down 8% sequentially. Just wondering if you could elaborate a bit more on that. I know you gave some explanations in the prepared remarks, but any more color you could kind of provide there given those diverging trends on the revenue expense side?
Paul J. Brody — Chief Financial Officer
The general factors that I cited, greater proportion of futures volume, which has a higher fee base and options as well as opposed to stocks somewhat lower exchange liquidity rebates. These all combined causes the aggregate number to not necessarily go hand-in-hand with the volume change or even the commission change. Generally speaking, the larger trends, they do go hand-in-hand. But from quarter-to-quarter, we see a different product mix and that can cause these sort of steaming anomaly.
Kyle Voigt — Keefe , Bruyette & Woods , Inc. — Analyst
Understood. Thanks.
Operator
Thank you. [Operator instructions] And our next question comes from the line of Craig Siegenthaler from Bank of America. Your question, please?
Craig Siegenthaler — Bank of America Merrill Lynch — Analyst
Hey, good evening, Thomas and team. Hope you all are doing well.
Thomas Peterffy — Chairman of the Board of Directors
Yes, we are. Thank you.
Craig Siegenthaler — Bank of America Merrill Lynch — Analyst
So, we had a follow-up to Rich’s first question. And we’re obviously not looking for any names, but can you provide any additional color on these global financial institutions? Where are they and their clients based and what exactly will they be using IBKR for?
Milan Galik — Chief Executive Officer, President and Director
Hi. Thanks for your question. So, we have a number of larger introducing brokers that we are integrating with right now. They are of the larger size. There are three of them. I would not — I would rather not tell you who they are. They have not publicized the partnership with us either. So, we just have to wait for that announcement. All I can tell you is that these are international organizations catering to clients from more than just one country.
Craig Siegenthaler — Bank of America Merrill Lynch — Analyst
And just for my follow-up, in the month of May, you lost an omnibus introducing broker relationship to a trust bank. I was just wondering if you could provide perspective on this outflow. And also, how could a trust bank win that business from IBKR?
Milan Galik — Chief Executive Officer, President and Director
So, this was one large Japanese introducing broker. We love them because they realized that they concentrated too much of their business in a single custodian. They decided to diversify. I think it was a prudent step for them, looking at it from their perspective. So that is what they have done. They currently custody with a provider that is offering them the solution of the trust bank so that’s what they’re in for.
Craig Siegenthaler — Bank of America Merrill Lynch — Analyst
Thank you. Very helpful.
Operator
Thank you. [Operator instructions] And our next question comes from the line of Ryan Bailey from Goldman Sachs. Your questions, please?
Ryan Bailey — Goldman Sachs Group, Inc. — Analyst
Hey, good evening everyone. So, amid some of the account growth slowdown, I was wondering if you could give us some color on the GLOBAL Trader side. If there’s been any difference in the accounts or the users of the GLOBAL Trader app? And then maybe just as my follow-up, I’ll sort of put it through there. Any color on the typical account sizes or the cash balances for those types of accounts?
Thomas Peterffy — Chairman of the Board of Directors
We started marketing the GLOBAL Trader not that long ago. We have more than 1,000 accounts. We have a lot of downloads. We would like those downloads to turn into more funded account, of course, but the adoption rate is picking up. We are advertising the GLOBAL Trader to despite the fact that it’s a simple trading up that currently allows trading of stocks in cryptocurrencies you would think that it really benefits the most of the retail clients as you can imagine.
We are advertising it to larger account holders in the way that we try to appeal to the fact that despite that most of the paper investors finances are managed by financial advisors, we believe that they should be willing to do an occasional trade themselves, and that is what we are advertising to them. But the global trader is a very simple way for them to trade quickly without contacting their financial advisors and executing the trade they want in the moment. Whether we’re going to be successful with this marketing campaign and managed to attract larger accounts, I think on the time will tell.
Ryan Bailey — Goldman Sachs Group, Inc. — Analyst
Okay. Thank you very much.
Operator
And this does conclude the question-and-answer session of today’s program. I’d like to hand the program back to Nancy Stuebe for any further remarks.
Nancy Stuebe — Investor Relations
Thank you, everyone, for participating today. As a reminder, this call will be available for replay on our website, and we will also be posting a clean version of our transcript on our site tomorrow. Thank you again, and we will talk to you next quarter end.
Operator
[Operator Closing Remarks]