Good afternoon, and welcome to the Aterian, Inc. third quarter 2022 earnings conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Please note, this event is being recorded. I would now like to turn the conference over to Ilya Grozovsky, Vice President of Investor Relations and Corporate Development. Please go ahead. Thank you for joining us today to discuss Aterian's third quarter 2022 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. These forward-looking statements reflect Aterian's judgment and analysis only as of today. 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 these 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 third 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 certain 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. On the call today, I'll go over the following topics. I'll start with a quick introduction of Aterian for those who are newer to our story. I will then review key takeaways from the third quarter of this year. I will then discuss our challenges and how we're dealing with them, including the economy and macro level pressure from supply chain disruptions and inflation. I'll then summarize how we see the long-term prospects for Aterian. For 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 owns and operates its many consumer brands selling products across various categories on channels such as Amazon, Walmart, Shopify, and eBay, both domestically and internationally. To allow us to scale, we invest 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 unsustainable 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 under our brands, manage these products at scale effectively across various channels, automate certain marketing and fulfillment tasks, and much more. Our goal in the long term is to become one of the most efficient consumer companies in the world, expanding our footprint globally while continuing agile supply chain to drive scale and profitability. To our key takeaways from our third quarter. I'll start with a quick summary of the main points and then discuss them in more detail. International supply chain is finally showing signs of a return to the old normal. Dramatic hikes in global shipping rates that negatively affected us for over a year has continued to subside. We're now shipping containers at rates close to the pre-pandemic levels. We believe that our defensive strategy of protecting market share through the last year has worked out, it's now time to get back on the offensive. We're now fully focused on making 2023 a pivotal year for Aterian. Through the fourth quarter of this year, we will continue to attempt to maintain our lower prices to liquidate expensive excess inventory, while using this effort to also attempt to gain as much market share as possible for our products. These efforts will hurt our adjusted EBITDA for the remainder of 2022, we believe they will put us in a strong position to reignite growth in 2023. We're also taking measures to reduce our fixed costs by restructuring teams and removing certain roles to set us on a path to profitability. It will take time to see the full effect of these actions, we believe that starting in 2023, we will begin to show improvements to our profitability metrics with a target of turning profitable at the adjusted EBITDA level starting in Q3 next year. I would like to now elaborate on each of these points and explain why we're optimistic that with the above-mentioned actions, management is taking the right steps towards putting Aterian back on track. I'll start by focusing on international supply chain updates. As many listeners who have been following our company in the last couple of years know, shipping rates for international containers have been the main culprit in putting pressure on our business model. As a reminder, the supply chain crisis that followed the COVID-19 pandemic led to a 5x increase in cost of shipping containers from China to the U.S. This increase required us in turn to increase our own prices for our products by an average of 20%. While the price increase was important, our blended contribution margin year to date was reduced to approximately 6%, versus our target of 15%. Additionally, the necessary price increases combined with reduced consumer spending and overall inflation have hurt our top line sales. Given that these difficult and unpredictable conditions limited our ability to drive sustainable growth, we opted to focus on protecting market share for our products until shipping prices come back to normal. The good news is that our bet seems to have worked. This past week, we've been able to secure shipping containers at pre-pandemic rates. We've also overall been able to protect our portfolio from losing relative market share. Which leads to the second point I mentioned earlier. It's now time to get back on the offensive, and we're aggressively pushing initiatives designed to prepare us for a strong 2023, with our eyes set on profitability in the second half of the year. The most important initiative was already started in the third quarter of this year, with a mandate we gave our teams to pursue lower price strategies in an effort to cycle through our current low margin excess inventory position. We've made the decision so that we can replenish new inventory at a higher margin, given the latest normalization of shipping rates. While not every product in our portfolio may have the same opportunity to do so, we're doing our best to capitalize on these aggressive pricing strategies to secure better long-term market share. As with traditional retail, sale volumes and overall demand increase typically drives more visibility for trending products in brick and mortar stores. Similarly, for us, Amazon and other e-commerce platforms we operate on typically reward sales increase with better visibility and ranking for our products. It is therefore our goal to increase sales velocity at the expense of our margins now in order to gain as much market share as possible, and then hopefully see the inventory coming in at a lower cost basis, allowing for margin increase. If our plan works as we hope, we believe that we'll be able to enter Q2 of 2023 with our products driving more sales, but also benefiting from the improved shipping costs to show stronger margins. As I mentioned earlier, our management team is focused on achieving profitability by the second half of 2023. We believe that in the current market conditions, attracting new investors and creating shareholder value starts with fixing the core metrics of our business and regaining trust. We've had to make some painful decisions in the last 12 months to protect the company as the macro level environment shifted rapidly from focus on growth to focus on profitability. Our profitability and overall goals for 2023 are not without risks, and in particular, the geopolitical tensions still at play in Europe and the Asia Pacific region cannot be ignored. We're operating based on data that we are seeing at present. The recessionary environment seems to have resolved the supply chain concerns. However, we're closely monitoring the looming energy crisis as potential future increase in gas prices could have a negative impact on our last mile shipping rates. Furthermore, the COVID zero policy in China is a concern as it can lead to factory shutdowns and other disruptions to our supply chain. Finally, a further decline in consumer spending given inflation and the Fed's current monetary policy and a focus on increasing unemployment could potentially hamper expectations for overall sales forecast next year. At this time, we're of the opinion that demand will remain relatively flat and that the negativity in consumer sentiment has mostly settled. Nevertheless, we remain optimistic that despite these risks, 2023 is an important year for us to push forward by launching new products as well as resuming our M&A strategy. Additionally, our efforts to strengthen our balance sheet have positioned us to start Q4 with $46 million in cash, which gives us confidence to weather further possible disruptions. With regards to growth in general, we continue to invest cautiously in driving long-term organic growth by slowly ramping up new products and investing in our operational capabilities in the European Union to allow us to continue to expand our business internationally. While we are being conservative with our expectations from organic growth, we're also dedicating resources to seeking opportunities to accelerate growth through M&A. The e-commerce industry as a whole has experienced extreme disruptions similar to those affecting us, including our competitors in the Amazon aggregator space. As a result, we're actively looking into opportunities to consolidate brand assets that we believe will be synergistic to Aterian given the investments we made to build a scalable infrastructure. Our efforts so far have been productive, and we're hopeful that our opportunism could pay off and allow us to acquire additional positive contribution margin generating businesses to accelerate our path to profitability. I want to thank our team and shareholders who continue to believe in us. We're working tirelessly to make 2023 the year that sets us back on track to continue to build the leading CPG platform in e-commerce. With that, I'll pass it to Ari to discuss the quarter's financials. Thank you, Yaniv. Good evening, everyone. Here are the financial performance details of our third quarter. For the third quarter of 2022, net revenue decreased 2.6%, or $1.8 million, to $66.3 million from $68.1 million in the year ago quarter, primarily due to softer consumer demand on marketplaces, offset by increased net revenue due to our decision to sell off inventory through reduced pricing to decrease our inventory levels on hand. Third quarter net revenue of $66.3 million is comprised primarily of $63.8 million of organic business, which we note includes revenue from our built brands and acquired brands starting one year after purchase, and $2.5 million of wholesale and other. The year ago quarter net revenue of $68.1 million was comprised of approximately $35.4 million from our organic business, $30.7 million in net revenue from our mergers and acquisitions, and $2 million of wholesale and other. Our organic revenue increased by $28.4 million from the classification of our past acquisition revenue into organic revenue, offset by a reduction in overall organic revenue due to reduced overall consumer spend in the period, further offset by an increased net revenue from our decision to sell off inventory through reduced pricing to decrease our inventory levels on hand. Our acquisition revenue decreased to zero from third quarter of 2022, from $30.7 million at third quarter 2021, due to all our acquisitions being owned for over a year and shifting into the organic revenue categorization. Our sustained net revenue was $54.2 million for the third quarter of 2022, compared to $59.8 million in the third quarter of 2021. The decrease is related to softer consumer demand on marketplaces, offset by increased net revenue from our decision to sell off inventory through reduced pricing to decrease our inventory levels on hand. Our launch phase revenues, which include a few new variations on existing product and product relaunches, was $1.6 million in the third quarter, down from $5.3 million in the year ago quarter. We launched one brand new product in the third quarter compared to zero in last year's third quarter. Importantly, after several quarters of no new product launches, we are planning on resuming new product launches and are evaluating additional launches in the coming quarters, primarily for 2023. Overall gross margin for the third quarter decreased to 45.5% from 50.2% in the year ago quarter. Our gross margin decline versus last year is from the margin impacts from inventory sell-off and from increased costs from supply chain disruptions, specifically increased cost of shipping containers. We believe the increased cost of shipping containers relative to third quarter of 2021 impacted our gross margin negatively by approximately 2.5% in the third quarter of 2022. Our overall third quarter contribution margin, as defined in our earnings release, was 1.1%, which decreased compared to the prior year's contribution margin of 12.1%. This decrease is primarily driven from liquidation net revenue of $10 million, which was sold at a negative contribution margin as part of our efforts to reduce our inventory on hand. The third quarter of 2022 saw our sustained products contribution margin decrease to 10%, compared to 14% in the third quarter of 2021 from product mix and our decision to sell off products to decrease our inventory levels via reduced pricing. Looking deeper into our contribution margin for Q3 2022, we saw our sales and distribution expenses continue to be negatively impacted by higher cost supply chain and last mile fulfillment costs due to inflationary pressures. Our third quarter 2022 variable sales and distribution expenses as a percentage of net revenue increased to 44.4%, as compared to 39.4% in the year ago quarter. We expect to see these impacts continue in the current quarter. While we continue to look for ways to mitigate higher cost dynamics in our supply chain and last mile costs, we believe we will continue to see contribution margin pressure for the remainder of 2022. We reported $108.9 million operating loss at third quarter of 2022 as compared to a loss of $7.5 million in the third quarter of 2021. The increased loss in the quarter is driven by our non-cash $90.9 million loss of impairment goodwill, primarily due to our decreased market cap at the end of Q3. The third quarter 2022 operating loss includes a gain of $0.8 million from the change in fair value of earn out liabilities, a non-cash loss of $3.1 million from the impairment of intangibles, and $2.9 million of non-cash stock compensation expense, while the third quarter 2021 operating loss included $4.2 million of a benefit from the change in fair value of earn out liabilities and $9.6 million of non-cash stock compensation. Net loss in the third quarter of 2022 was $116.9 million, which was a decline from the net loss of $110.6 million in third quarter of 2021. Third quarter 2022 net loss includes an impact of operating loss included of the non-cash $90.9 million of impairment of goodwill, a gain of $5.5 million in net charges from the changes in fair value of warrants, and a $12.8 million loss from the derivative related to the offering of common stock. While third quarter 2021 included a $107 million loss from extinguishment of debt, an $8.1 million gain from the change of fair value of warrants, and a $1.4 million loss associated with the derivative liability in our term loan at the time. Adjusted EBITDA, as defined and reconciled in our earnings release for the third quarter of 2022, was a loss of $9.1 million, compared to a gain of $0.7 million in the third quarter of 2021. Turning to the balance sheet, at September 30, 2022, we had cash of $26 million, compared to $34.8 million at the end of June 30, 2022. The decrease in our cash is due to our net loss and repayments of our credit facility. Our credit facility net was down to $23.9 million at September 30th versus $33.9 million at June 30th, 2022. Further, the September 30th, 2022 cash balance does not include the additional capital raise completed on October 4th, which added $20 million to our balance sheet. When taking that capital into account, our cash position at the start of Q4 2022 was approximately $46 million. Our inventory was $60.5 million at September 30th, 2022, which is lower than the $76.1 million at June 30th, 2022, due to our Q3 sales along with the efforts to reduce inventory levels. As previously mentioned, we made the strategic decision in Q4 of 2021 to increase inventory levels to mitigate supply chain constraints. However, with the softening consumer demands, we continue to be long on inventory. As such, we anticipate continuing to move excess inventory during Q4 at reduced margins to help normalize inventory levels. As our supply chain continues to improve, we believe we can reduce our more expensive inventory level on hand and replenish inventory at improved costs when we reorder products for 2023. Looking at our Q4 of 2022 and taking into account the current global environment and rising inflation, we believe that fourth quarter 2022 net revenue will be between $45 million and $55 million. As we look at 2023, we are optimistic of our improving supply chain, as the hike in global shipping rates that negatively affected us in the past continues to subside. We have also taken measures to reduce our fixed costs by restructuring teams and removing certain roles. At this time, we believe that demand will remain relatively flat and that the negativity in consumer sentiment has mostly settled. With these key factors in mind, we are targeting to achieve profitability starting in the third quarter of 2023. We will not provide any additional guidance for 2023 at this time. In closing, the third quarter of 2022 saw continued challenging macroeconomic conditions and unpredictable consumer spending habits. We expect these challenges to continue through 2022. We are starting to see supply chain improvements, and container costs are currently returning to pre-pandemic levels. As such, we continue to be very confident, optimistic, and proud about the business we have built, our products, our technology, our logistics network, and most importantly, our dedicated and hardworking people. With that, I'll turn it back to the operator to open the call to questions. We will now begin the question and answer session. To ask a question, you may press star then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star then two. At this time, we will pause momentarily to assemble our roster. The first question is from Brian Nagel with Oppenheimer. Please go ahead. Hi, good afternoon. Good afternoon, Brian. I've got a couple questions. With regard to the location of product in the quarter and the impact upon your financials, I guess the question is, Pardon me, Mr. Nagel. This is the conference operator. Your audio is breaking up to the point of being unable to understand it. If you could possibly disconnect and dial back into the call, we'll get you right back into the queue again. Okay. Our next question will be from Brian Kinstlinger with Alliance Global Partners. Please go ahead. Great, thanks. Am I clear? Yes, sir. Please go ahead. Great, thanks. First, you mentioned the launch of your first new SKU in some time. Can you share your plans with us regarding SKU launches in 2023, assuming current conditions hold, including global shipping rates? Is there a monthly or quarterly target? I know a long time back you had given targets. Is there anything you can share with us regarding that next year? Hey, thank you, Brian. This is Yaniv here. Thanks for the question. Yeah, as you mentioned, it's great for us to go back and launch products and, as you said, one product in the third quarter. I also want to mention we also working on what we call variations of products, meaning all sorts of additional products that supplement existing products as part of our efforts. In general, though, we don't have a concrete goal yet, given the fluidity of everything that's happening on supply chain. The goal is to start increasing the amount of products that we launch as we get more comfortable that what we're seeing on the supply chain is here to stay. That's really kind of how we think about it at this point. Artie, if you want to add anything. Yeah, no, I think, Yaniv, that's a good answer. I think the other side, Brian, I think, keep in mind, in the past, we were definitely doing a lot more volume of product. I think one of the things we're also thinking about is about lesser, bigger products, too, as we think about 2023. To Yaniv's point, it's still very volatile, I don't think we have anything concrete from targets. Those are the things we're definitely working on. Okay. As you're evaluating M&A opportunities, which you've announced one, you've got increased capital, I figure those targets also have the same inventory of high attached shipping rates, high priced COGS overall. How does that impact the strategy? As you acquire companies, how does that impact the acquisitions? When we look at various targets right now, obviously, as you mentioned, we're seeing some of the same impediments that hurt us and others in the industry. For us, I think patience is extremely important here. We're seeing a lot of these targets, as I said, struggling and kind of trying to find the best way forward. For us, as I mentioned, we don't want to overpay, we want to make sure that what we're looking at in terms of valuing these companies, the impact is already in there, and that we can really kind of wrap our heads around what's the actual path forward for this asset. In general, though, it's a positive thing. We are now in a position where we believe that there could be a lot of opportunities for us to acquire accretive contribution margin generating businesses at much lower cost than it would have been probably a year ago when we still saw the COVID effect inflating some of the numbers of these targets. Again, the bottom line is we're being cautious and waiting and patient to see exactly where some of these targets are going to land before we pull the trigger. We think the opportunities are there, and we're working on that. Great. My last question, then I'll get back in the queue. You commented that you're seeing shipping rates about back to levels of pre-COVID. As we look at your gross margin, obviously mix does matter, as we look at your gross margin, with that said, and the cuts you're making, should we assume when you get back to profitability, you'll have similar gross margins where we saw low to mid 50% range when that occurs in the second half of the year? Is that the assumption that gets you there? Artie, you want to take that one? Yeah. Brian, I think you're thinking about it the right way. I think product mix is very important in that. As we're clearing out inventory, that also kind of has an effect depending on how successful we are there. Yeah, I think if you think about the ideal model, it's definitely in the kind of mid-50s, right, as you're pointing out too. Then obviously other factors that contribute into CM, which would be our variable sales and distribution costs would also factor in that. That's certainly the numbers you're putting out there, that range is definitely something that we should theoretically be achieving. Great. Thank you so much. I'll get back in the queue. The next question is from Brian Nagel with Oppenheimer. Please go ahead. Hi. Hope you can hear me better now. We were having some phone issues here. Much better. Okay, cool. The question I was asking, just with regard to the liquidation of the product here in the quarter, I guess just the thought process behind that. It seems that you liquidated it, obviously you took the hit to contribution margin. Was there any consideration of just allowing that product, albeit higher cost, with the higher costs associated, to kind of work through the system naturally? Do you run the I guess the question I'm asking is, the volume of product that was liquidated, is there the risk that you pulled forward some demand that could impact sales of products in the coming quarters that have a potentially lower cost associated with them? Hey, Brian, good questions. Let me take those. First of all, the logic behind it is, as you know, you've been obviously covering us for a while, you know that we had to bring in a lot of inventory at a cost basis that was very high given the shipping container rates. Obviously, like any other company in this industry, we couldn't stop selling, right? We had to eat those costs and increase our pricing, to the consumer, which drove less top-line sales and also less contribution margin. Now that we're seeing the container shipping come down, we're still sitting on a lot of inventory that we brought in at this cost basis that's too high. The risk of not cycling through that inventory and letting it just follow its due course is that, if our competitors in the particular product lines that we are in are able to do that before us, in 2023, their cost basis will be lower, and they'll be able to come in pricing that could be damaging to us in terms of market share, right? They could undercut us on price. In a way, for us, we believe that, again, the supply chain is normalizing and that it's very important for us to cycle through that inventory so that we can bring back inventory at a cost basis that is competitive. Does that make sense on your first question? Yeah, no, that makes perfect sense. Yeah, I get it. If I could follow up- And then- Oh, go ahead. Yeah. In terms of pulling forward demand, sorry, yeah, I think that's what you asked, right? We don't think of it like that. I think instead, we're looking at it as an opportunity to capture more market share from our competitors, right? As I said, as we are looking at this excess inventory, we are looking at this as life gives you lemons, so make lemonade with them, right? There's one advantage of having that excess inventory, that if we're willing to take this bet that we can come back and bring in more inventory at a cheaper cost basis, selling it now at a lower price, although it hurts our margin, allows us to take market share from our competitors, right? Our goal is to basically align the product inventory level with the optimal run rate that we can achieve and the highest possible margin when we bring them back in. Meaning that as we're normalizing and liquidating excess inventory, by being very aggressive on pricing, we're capturing market share. Hopefully, we time it well with the arrival of more inventory at a lower cost basis to retain that market share while now also having the expanded margin, right? Does that make sense how I explained it? It makes perfect sense. I get it. Brian, can you repeat t he last piece of the question? How should we think about the earnings tailwind that could come as a result of these shipping costs having moderated so significantly? Yeah. Okay. Yeah, now I heard you. Yeah. Listen, as you know, this has been the epicenter of our challenges in the last year plus. For us, it's been a very tough time to run our business with reduced margins and products that need to be priced in a place where they become more difficult for consumers to buy. There's a lot of advantages of obviously seeing those costs coming down. First, again, we can lower our prices and go back to our target 15%, 16% contribution margin, meaning that we should also gain more sales. More revenue on the top line. This is just tremendous for us. The only thing I'll say, though, is that we are also, generally, the economy is not in its best place. For us, I think one of the most challenging questions is where is consumer demand is going to be? We know that we should be able to get to more competitive pricing for consumers, and we should see significant increase in our contribution margin, which are all great tailwinds for us. The underlying questions that we're still, and we've been, I think, overall conservative around how we think about it, is where are consumers going to be, given that everything points out to a challenging time for the economy going forward. I think, again, on one hand, great news, and again, potentially strong tailwinds for us with improved margin, while we can have more competitive prices. Again, just to be clear, this is after we cycle through our inventory. We still have work to do there, but that's great news. The big question is, where are consumers going to be? Where is overall demand going to be? I think we've taken an overall conservative view of that. We still feel good about the picture for Aterian. Got it. I appreciate it. Thank you. Thank you. Again, if you have a question, please press star, then one. The next question is from Matt Koranda with Roth Capital. Please go ahead. Hey, guys. Good evening. Can you just help us understand the $45 million-$55 million range that you put out for the fourth quarter for revenue? I guess just what I'm trying to understand is why the drop-off sequentially versus the third quarter, despite it just seems like you're signaling there's more liquidation of inventory to come. I would expect sort of you to stay on the gas on revenue, but just any clarification or puts and takes on sort of what's going on with the range for fourth quarter? Artie, you want to take that one? Yep. Yeah. Thank you, Yaniv, and thank you, Matt. Listen, Matt, I think as Yaniv said, we're trying to be aggressive and move this inventory. At the same time, there is a lot of volatility in what we're seeing from a consumer spend, and what the consumer sentiment is, especially going to Q4. I think in some aspects, we saw a relatively decent Prime Day, but certainly not as strong as the Prime Day in June, and I think that's what Amazon also pointed towards when they've talked about it. At the same time, you're right. Discounting pricing is going to perhaps push volumes up, but it's really hard to say. I think when we looked at it and we look at our range, I think it's still very common and very core to our business that we still see the same splits. I think Q2 and Q3 have historically always been our strongest products. We drive a lot of dehumidifiers and AC. They're some of the best-selling products on Amazon. Q4 has always been lower price points. Consistently do good numbers and good units, and we have a lot of best sellers that hit Q4, like our steam mops and other things like that. Certainly, it's never been at the levels of our Q2, Q3. I think when you look at it from our splits perspective, if I'm thinking about the middle of that range, that would put you roughly at 23%, which is 24%, which isn't far off to what we've historically done. I don't think it's really far off there. You're right. If we're a lot more successful in that, we could be pushing higher range or beyond that. Right now, I think considering the macroeconomic conditions, I think we're being prudent there, and I think that's a comfortable range in line with historical percentages. Okay. Fair enough. Just wanted to get a sense for how we expect margins to trend. Any help on just sort of how much of the fourth quarter mix you expect to be liquidation revenue versus sort of sustain? Should we expect sort of the similar contribution margin on a go-forward basis coming from that liquidation until you get through the higher cost inventory that you want to clear? Artie, I'll let you answer that one, too. Yep. Thanks, Yaniv. Matt, another good question. We got a lot of opportunities and a lot of interest in both how we liquidate and how we liquidate products from Amazon. I would hope that we do better than we just saw this quarter, we're still too early in the process. A lot is going to depend on how Black Friday and Cyber Monday goes. I think conservatively, I would look at the splits that you see in our press release between sustain and liquidate in the back of the tables. I would look at those and say I would assume consistent. Okay. All right. Got it. Yeah, consistency makes sense. Help us understand the context for Be profitable on EBITDA in the third quarter of next year. Are you just effectively saying that you still have higher cost inventory to work through that'll take until all the way through the first half of 2023? Do we see some light at the end of the tunnel on sort of outbound shipping that might be percolating that we're counting on in the third quarter? What are the kind of the positives that you see coming in the third quarter that kind of get you the visibility into positive EBITDA in the third quarter of 2023? Artie, I'll let you answer that, too. Yep. I mean, Matt, listen, as we said earlier, Q3 tends to be our strongest quarter. May, June for our summer products are always a little questionable depending on weather and other things. To your point, just to give you a little bit of understanding, I'm ordering my summer products today and tomorrow, right, in the next month. I've already put my POs in, right? Those products at the lower shipping container rate don't show up until May and June, right? I think in some standpoint, that's why I think we're pointing towards there. We're hoping that any of the long inventory related to my summer products will be gone by then, as Yaniv mentioned in his remarks that we're going to start seeing the improvement in Q2 of 2023. Certainly, we hope if everything goes our approach, that we would see the full impact of the improvements in Q3 2023, hence why we're pointing to that particular period. Okay, got it. Maybe last one, either Yaniv or Artie can take this one. Just what are you seeing in the broader pricing environment, I guess? Are you seeing competitive pressure from some of those more stressed competitors that are trying to clear inventory? Are you seeing folks stampede and you're benefiting in this environment by being able to kind of be more aggressive on price and take share? Just wanted to kind of get a better sense for the overall context of what's going on with pricing that you observe across your categories. Hey, Matt, it's a great question. Let me take that one. I guess the answer here is, as you might expect, right, we're seeing kind of interesting patterns of companies looking to also discount or adjust inventory prices down and then kind of trying to normalize their position as well. What's interesting is to really try to kind of differentiate between those who are trying to do this and will come back to be competitors and those who are throwing in the towel, and that's not always easy to do. Literally, our teams are looking at our analytics and evaluating per product and category if we should be worried about certain price cutting or should we actually see that as a positive. There's no one clear answer across the board, as you can imagine, depending on the category and the type of products and the type of competitor that we're up against. We could be looking at a competitor that is, again, just throwing the towel, and we can see their price reduction as a temporary threat. Some that maybe are trying to be more opportunistic and think like us long term about how they can maybe take advantage of the situation and replenish, right? In the meantime, try to be more aggressive on taking market share. There's not a clear-cut answer across the board, but it's a very good question, and our teams are tactically very much on top of it. I think, again, our investment in analytics and our ability to look at all this data point in real time allow us to manage pretty well both situations. Okay, awesome. Appreciate it, guys. This concludes our telephone question and answer session. I would like to turn the conference back over to Ilya Grozovsky for any online questions. Thanks. As part of our Shareholder Perks Program, which, as a reminder, investors can sign up for at aterian.io/perks, participants have the ability to ask management questions on our earnings call. I wanted to thank all of the Shareholder Perks participants for their loyalty, their participation in the program, and their questions. I have picked a few of the most popular questions that they have sent in. Here we go. With shipping costs significantly down and almost at pre-pandemic levels, does the management team finally see a turnaround and return to profitability in 2023? Yaniv? Yes. Yes, Ilya, thank you. As we said, the answer is yes. It's management's focus and our target to see adjusted EBITDA profitability in the third quarter of 2023. As we said also in the press release, this is driven by two forces, right? One is obviously, as we talked about, the lower shipping costs, but also some cost reductions that we're taking. Again, it's really kind of the focus on management right now to prepare us for that. Great. Okay, the next question was, can you talk a little bit about your recent acquisition and future acquisition strategy? Yeah. The recent acquisition is a brand that fits really well in our current portfolio. I think I've seen some assumptions online that it might be an essential oil brand. It's not the case. For competitive reasons, we're not going to disclose any further here on what that particular brand was. In terms of future acquisitions, we're actively looking into opportunities, especially when it comes to consolidating brand assets that we think are synergistic to our portfolio. Especially, we believe that in current environment, there might be opportunities. As I said earlier, we're just being cautious and taking our time to really make sure that we are bringing in the right type of assets So really cherry-picking brands or selling products that fit our current portfolio. This is all ongoing, and we'll continue to make progress on it. Okay, great. Then the last question, and perhaps the most important question was: how do you plan to increase shareholder value? Yeah. I think as we mentioned earlier, and probably the most important thing is we're working really hard towards profitability. As we mentioned also, we started kind of like, although slowly, right? We started to work again on developing new products that we can launch. I think we made a lot of efforts behind the scenes to expand our capabilities in Europe. It's been on our to-do list for a while to put more efforts into Europe. Again, the shipping pricing increase had kind of prevented that from happening earlier. Now that things are starting to get better, we want to take advantage of the efforts we've put in place to expand our footprint in Europe. I think that's going to be exciting, although it will take time. Then finally, we're looking for opportunities to add incremental brands to our platform via acquisitions. I think, again, together, all these efforts should allow us to increase revenue and lead to adjusted EBITDA profitability, and again, hopefully unlock much more shareholder value. Management is very much focused on all these things. Great. Thank you, Yaniv. This concludes the Q&A portion of the call. In terms of the upcoming calendar, Aterian management will be participating in the BTIG Technology Innovation Summit November 15th, which will be held virtually. The 13th Annual Craig-Hallum Alpha Select Conference, November 17th in New York City, and the Roth 11th Annual Deer Valley Conference, December 14th through 17th. We look forward to speaking with you on future calls. This ends our call, and you may disconnect.