Today, thank you for standing by. Welcome to Cellebrite's fourth quarter, 2022 financial results conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there'll be a question- and- answer session. To ask a question during the session, you'll need to press star one one on your telephone. You will hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Sabrina Mathews with Investor Relations. Please go ahead, Sabrina. Thank you. Welcome to Cellebrite's fourth quarter and full-year 2022 financial results earnings call. Joining me today are Yossi Carmil, Cellebrite CEO, and Dana Gerner, Cellebrite CFO. This call is being recorded. A replay of this recording, as well as the presentation that accompanies this call, will be made available on our website shortly after the call. A copy of today's press release and financial statements, including GAAP to non-GAAP reconciliations, as well as supplemental financial information for the fourth quarter, are available on the investor relations website at investors.cellebrite.com. Also, unless stated otherwise, our fourth quarter 2022 financial metrics as well as the financial metrics provided in our outlook that will be discussed on today's conference call will be on a non-GAAP basis only, and all historical comparisons are with the fourth quarter of 2021, unless otherwise noted. In addition, please note that statements made during this call that are not statements of historical facts constitute forward-looking statements. All forward-looking statements are subject to risks and uncertainties and other factors that could cause matters expressed or implied by those forward-looking statements not to occur. They could also cause the actual results to differ materially from historical results and/or from forecasts. Some of these forward-looking statements are discussed under the heading Risk Factors and elsewhere in the company's annual report on Form 20-F, filed with the SEC on March 29, 2022, as amended on April 14, 2022. The company does not undertake to update any forward-looking statements to reflect future events or circumstances. Slide number three provides the agenda for today's call. With that, I'd like to turn the call over to Yossi Carmil, Cellebrite's CEO. Thank you, Sabrina, and thank you all for joining us today. I'm pleased to report that in 2022, we've made significant progress advancing our mission to help our customers modernize investigations by digitizing their workflows. Our results and achievements in the fourth quarter and throughout the past year reflect four important things. The first, the markets for investigative digital intelligence solutions remains healthy. Second, our leadership position is strong. We have a long, broad runway for profitable growth in a market that remains highly under-penetrated. Third, we executed well on our development roadmap and go-to-market initiatives. Fourth, thanks to our progress in 2022, we are well positioned to deliver strong results in 2023. Before I cover each of these areas in more details, I'd like to quickly review our Q4 results and select KPIs that are critical to the health and success of our business. Our ARR grew 33% year-over-year to reach $249 million. Our quarterly net retention rate was 130%. We closed 29 large deals greater than half a million US dollars in the quarter. We reported Q4 revenue growth of 9% to $74 million, largely attributed to subscription revenue growth of 24%. We delivered Q4 adjusted EBITDA of $16.1 million. We also further strengthened our financial foundation, ending the year with cash and investments totaling $206 million and no outstanding debt. A little bit about the healthy market environment. We continue to operate in a healthy market with significant growth opportunities in front of us, thanks in large part to Cellebrite industry-leading technology. Against this backdrop, we continue to implement our growth strategy of expanding business with existing customers through upgrades, upselling and cross-selling, and by winning new logos in both public and private sectors. Cellebrite solutions are increasingly attractive today, with strong demand and positive feedback from customers and prospects. Just as important, customer budgets for our type of digital intelligence solutions are expected to remain robust in 2023, as they are generally insulated from the broader macroeconomic pressures that are currently impacting a wide range of other technology sectors. In the Americas, which by the way represents 52% of our fiscal year 2022 revenue, law enforcement budgets have historically grown over time, and we anticipate that this trend will continue in 2023. In the U.S., incremental U.S. federal funding for law enforcement agencies of all size will support increased staffing and additional resources to help them stay current with the latest evidence-based practices. We expect overall investigative Digital Intelligence spending by law enforcement and intelligence agencies in other geographies will remain solid in 2023. Cellebrite has built a reputation as a trusted Digital Intelligence market leader, which is best reflected by our success in increasing our wallet share within existing customers. Over the years, we have leveraged our traditional stronghold in Collect & Review solutions to increase our footprint within Digital Forensic Units by helping them make digital evidence more accessible, intelligent, and actionable. We believe that our newest Collection & Review, Premium Enterprise, and Premium as-a-Service solutions are true game changers for customers, and our Physical Analyzer continues to be the leading review tool in the investigative fields. With ongoing investment in Collection & Review and the addition of new investigative analytics offering like Pathfinder, we are supporting the natural expansion of our customers' operation and continue unlocking new buying centers to address a growing range of use cases. Our success in upselling and cross-selling into our installed base is best reflected in Q4 in our net retention rate of 130%. This was the sixteenth consecutive quarter with reported NRR greater than 120%, and we are very proud of our best-in-class retention rates, which demonstrate the power and the value of our go-to-market strategy. Furthermore, we closed 29 large deals in Q4, bringing our 2022 total to 101 large deals. This is 22% higher than in 2021. We expect that winning more business with existing customers will continue to fuel Cellebrite's growth well into the future. A little bit about the product development and go-to-market execution. During 2022, we took important steps to further advance our portfolio of solutions while also investing in the cloud infrastructure necessary to scale our SaaS offering like our Guardian solution. We enhanced our offering by adding new features, capabilities, and functionality that help our customers extract, filter, analyze, and manage data and evidence efficiently and securely. With Collect & Review, the newest version of our Premium as-a-Service offering was rolled out early in the year, and we were pleased to see success in the U.S. state and local government agencies. It is development effort like this that have helped us to address major pain points for customers and underpin our efforts to fortify our long-standing strength in Collect & Review and extend our reach into adjacent investigative analytics and case management solution. This past year also marked meaningful investment to expand our global sales force with an emphasis on strategic accounts management to improve our effectiveness in the U.S. and in Europe. We made solid progress. Our sales organization grew by 10% as we put the right talent in the right roles to best serve our customers. This infusion of resources helped us to deliver on ARR, NRR, and large deal targets. We delivered excellent results in the U.S. state and local law enforcement during Q4 and gained greater confidence in our ability to realize the growth potential we see in Europe. Guardian is gaining traction in the market with hundreds of new user now benefiting from this simple, secure, and scalable cloud-based solution for investigative and evidence management. We see continued growth ahead for our SaaS solutions, which appeal to a broader range of customers who need to modernize their digital operation, but often lack the budget, IT staff, and infrastructure which is associated with on-prem solutions. Let's talk a little bit about customer success. I'd like here to briefly highlight some of our Q4 deals, all of which demonstrates how Cellebrite technology is helping these customers modernize their operation while expanding our wallet share. In the Asia Pacific region, we grew our long-standing relationship with a regional law enforcement agency who is now deploying our Premium Enterprise solution more broadly into the field to help them accelerate their investigations. As a result, our ARR from this customer will grow by more than 50% to nearly $1 million and help set the stage for further expansion. In the US, a large federal agency selected Premium Enterprise to augment use of our UFED at regional labs and leverage their AWS private cloud infrastructure to move more capability into the field and operate their mode of operation. This deal increases our ARR from this account by almost 60% to nearly $2 million. I mentioned earlier that our investigative analytics solution, the Pathfinder, is enabling us to unlock new buying centers and support customers as they modernize their digital investigative workflows. For example, we closed two large Pathfinder deals in Q4. One of which was a mid six-figure deal with one of the largest state and local police agencies in the U.S. The other multi-year low eight-figure deal that triples our ARR with a national law enforcement agency in Western Europe to over $4.5 million per year. Both deals show Pathfinder unique value in helping law enforcement professionals accelerate investigations by sifting through mountains of digital data to surface the most relevant evidence, discover connections, and collaborate more efficiently. Finally, in the private sector, we closed four notable deals, two with service provider partners and two with Fortune 500 corporate customers. All of these customers purchased Endpoint Inspector to improve overall operational efficiency by remotely collecting data from mobile devices and computers, thereby substantially upgrading costly, time-consuming legacy approaches. In closing, our solid execution over the past 12 months has enabled us to enter 2023 primed to further capitalize on the vast market opportunity. Digital transformation has clearly reached all industries, and it is here to stay. Our customers, regardless of whether they are national, regional, or local public sector agencies or private sector businesses, are under increased pressure to modernize their investigative workflows in the face of rising volume of increasingly complex data, operational inefficiencies, and greater scrutiny around the ethics and accountability of how digital evidence is handled throughout its life cycle. Cellebrite is playing an important role in enabling our customers to address those challenges. I'm confident that from where we stand today, we have the products, the programs, and the people needed to execute and deliver on our 2023 financial targets. We have established a scalable model that will support improved fundamental performance even as we invest for the future. We mobilize to capture demand in a healthy market and further fortify our market leadership, our priorities this year are clear. First, we plan to deliver ongoing innovation through state-of-the-art SaaS solutions paired with on-prem offerings that will help customers modernize their digital investigation workflows. This will require sustained investment in R&D across our entire portfolio and in the technology infrastructure that supports it. Second, we will focus on extending our leadership in Collect & Review by advancing our UFED and Premium solutions that are used extensively by digital forensics labs. Third, we are broadening our reach beyond our stronghold in the labs by accelerating our progress with a high-value investigative analytics and case management solutions, which helps investigative units move faster and collaborate securely to resolve complex time-sensitive cases. Now, by executing against these high-level priorities, we expect to accelerate our revenue growth rate, deliver improved profitability, and generate strong cash flow from operation in 2023. I would like to use the opportunity and thank to my colleagues at Cellebrite for their hard work in 2022 and their continued commitment to make our world safer. I'm excited for what lies ahead. Moreover, we remain committed to helping our customers modernize investigation and close the public safety gap. In short, I'm confident in our strategic direction and in our ability to capitalize on the attractive opportunities in front of our team. With that, I will turn the call to Dana. Thank you, Yossi. As Yossi mentioned earlier, ARR grew 33% year-on-year, reaching $249 million for 2022. This growth reflects our success on a number of fronts, with the biggest driver being continued expansion with existing customers through subscription licensing. Over the past several years, we have made tangible incremental progress every quarter to convert customers to a subscription model from traditional perpetual licensing. This transition is now largely complete as we enter 2023. Total revenue for the fourth quarter was up 9% from the fourth quarter of last year and reached $74 million. This was driven primarily by strong subscription services revenue growth of 24%. 84% of total quarterly revenue came from subscription services, up from 67% in the same quarter two years ago and 74% in the same period last year. With software subscription services now generating a substantial majority of our revenue, we believe that 2023 will be a year in which the power of our subscription-based business model will become increasingly apparent. Our growth margins rose 84% in Q4 as compared to 82% from the fourth quarter of last year, benefiting from the increased portion of subscription sales, which carry a lower cost of goods sold. In terms of operating expenses, I will discuss these on a non-GAAP basis, excluding share-based compensation, amortization of intangible assets, acquisition-related expenses, and one-time expenses. Q4 2022 non-GAAP operating expenses were $47.8 million in the quarter. As you may recall, the fourth quarter of 2021 was the first quarter carrying full public company costs and was further impacted by the cost from the acquisition of Digital Clues. Our fourth quarter 2022 operating costs reflect prudent spending aligned with our commitment to deliver sustainable EBITDA improvement, as well as slower than anticipated annual incentives and quarterly variable compensation costs totaling approximately $4 million. We ended the month of December with 1,004 employees, up 12% from the end of December last year and consistent with the level at the end of the third quarter. We believe we now have the appropriate teams in place to address the opportunities and challenges that lie ahead in 2023. Adjusted EBITDA in the quarter was $16.1 million or 22% on a margin basis. Our Q4 adjusted EBITDA results reflect the strong performance of subscription revenues in the quarter, which contributed to the higher growth margins supported by cost efficiencies, while continuing our investment in maintaining our technological and market strong position. Moving forward, we expect to deliver EBITDA growth in 2023 as an accelerated revenue growth rate coupled with prudent spending levels is expected to produce operating leverage. Non-GAAP net income in Q4 was $15.3 million and non-GAAP fully diluted earnings per share was $0.08. I'm pleased to report that we ended the year in a strong cash position. We generated cash from operations in the fourth quarter of $36 million, a result of a strong quarterly operating performance. For the full-year, we reported $20.6 million of cash inflows from operations. We ended the month of December with approximately $206 million of cash equivalents, and investments versus $182 million at the end of 2021. I will conclude my remarks by providing some additional context around our 2023 outlook. We expect our ARR to grow between 21% and 25% to $300- 310 million by the end of 2023. Consistent with prior years, we anticipate that expansions from existing customers will fuel the majority of our growth with a higher contribution from new logos than last year. We expect full-year 2023 revenue to range from $305- 315 million, which represents 13%-16% growth over 2022. In other words, our 2022 ending ARR of $249 million represents 79%-81% of our 2023 revenue targets. When combined with a healthy pipeline and reasonably assumptions around net dollar retention rate, we believe that these top-line targets are achievable. In line with historical trends, we expect full-year revenue will be weighted towards the second half, and quarterly revenue growth rates will be higher in the second half of the year versus the first half of the year. These dynamics primarily reflect the wind down of perpetual license deals and the typical year-end spending activities associated with our U.S. federal customers in September and most other accounts at the December year-end. From a profitability perspective, we expect non-GAAP gross margins to be between 80%-82%. With non-GAAP operating costs expected to grow in the range of 7%-11% to between $217- 223 million, we currently anticipate adjusted EBITDA in the range of $35- 40 million or 11%-13% of total revenue. While we anticipate higher profitability in each quarter of 2023, we believe the most significant gains will occur in the second half of the year when higher revenue will drive incremental operating leverage. We believe that the investments we are making to advance our product development roadmap and go-to-market initiatives will yield attractive returns that support further margins expansion in 2024 and keep us on track to reach our original long-term EBITDA targets of 20% or greater. In closing, I would like to echo Yossi's excitement about Cellebrite and what the new year will bring. We are a market leader with innovative solutions targeting a large, growing global addressable market. This translates into opportunities to increase penetration into our expansive customer install base, complemented by ongoing efforts to win new accounts around the globe. With much of the heavy lifting associated with converting our customers to subscription licenses behind us, we expect our top-line growth rate to accelerate from 2022 levels. Just as notable, thanks to the substantial investments we made last year to build out our organization, we are well-positioned to convert storage revenue into improved profitability and stronger free cash flow. We look forward to helping investors gain a better appreciation for everything that Cellebrite is doing to create value over the coming months as we make tangible progress towards the long-term targets we shared when the company went public a year and a half ago. With that, I would turn the call to the operator to open the Q&A session. Thank you. As a reminder, to ask a question, you'll need to press star one one on your telephone. To withdraw your question, please press star one one again. Please wait for your name to be announced. Please stand by while we compile the Q&A roster. Our first question comes from Jonathan Ho with William Blair. Your line is now open. Hi, good morning and congratulations on the strong results. I just wanted to maybe start out with a couple of questions around guidance. Could you maybe unpack for us the 2023 guidance a little bit more and help us, you know, quantify how to think about the growth in revenue or ARR for the specific categories? I think it'd be helpful to maybe understand, you know, how each of those is going to contribute to your current guidance. Yes, for sure. I'll take it, Yossi. If you remember in 2022, we've seen continuous reduction in our perpetual and one time revenue from licenses, especially towards the second half of the year. We expect also in 2023 to see continuous weakness, winding down of this business to a very marginal, at a very lower 1% of revenue. As such, when we are talking about our growth expectation on our top line, if you take into consideration comparing our 2022 financials, they're around 20% or, I would say, 18% of the business came from one time activity, whether services or licenses. The part associated with the one time perpetual will be very marginal, most of the growth will come from subscription business. In principle- Got it. Okay, sorry. Yeah. I think my question is more along the lines of, you know, what is the contribution, you know, from either the core Premium products, Pathfinder, Collection & Review, like how should we think about, you know, the growth rates on a, on a product basis, you know, as opposed to, you know, the revenue mix? Most of the revenue from subscription in 2022 came from the Collection & Review. I would say around 90%+ of the revenue from subscription came from Collection & Review. We expect Collection & Review to grow and be very similar also from the subscription business in 2023. This is because we are seeing a very good acceptance and a huge potential with our advanced Collection capabilities that have been distributed in 2022 through not only the standalone Premium but Premium Enterprise, and in the second half, a very good attraction of the Premium as-a-Service. We do expect the investigative analytics and management solution to grow marginally as a percentage of the pie in 2023 compared to 2022. Great. You know, just as a follow-up, what is giving you the most confidence that the growth will accelerate in 2023? Can you maybe help us understand what's changed versus 2022 or what investments you've made in 2022 to make you more optimistic about that opportunity? Thank you. Yeah, you know, I always said that comparing 2022 to 2021 was actually comparing apples to pears because 2021 was so heavily weighted to one time revenue recognition of perpetuals. As such, it was very difficult to show the true growth through revenue, and the mainly true growth which presented itself through the ARR growth. Moving into 2023, and especially from Q2 of 2023, where the business expected to be from what we are standing, mainly comparing the right mix of revenue types, Q2 of 2022 to Q2 of 2023 and onwards, we will actually be able to see the growth rates also on the revenue side. There was also last quick time, the level of the level of acceptance of the solutions that we brought in, I would say Q2 and Q3, 2022 into the market and how they resonate and how they grow. As you know, we always have the mix of growing with, I would say existing products within existing logos, but to additional buying centers that we clearly identify, and then adding new logos, which will become something which is much stronger, especially if I look at the U.S. market and if I look at the what we call the long tail, sector of thousands of customers in the state and local government. Adoption rates of the Premium as-a-Service were pretty strong in Q3 and Q4. The Premium Enterprise well accepted the number of endpoints through which our equipment connected to Premium Enterprise are growing. I'm pretty confident also about the fact that we feel very comfortable right now when it comes to the investigative analytics with a much more focused, I would say go to market, and relying or lying on the success of Q4. We see it as a very solid growing business engine in 2023. Combine basically the targeted amounts of new logos that you are aiming, combine it with our well-identified buying centers within the existing, the adoption rates of the Collection Review so far in the second half of the year, we feel very confident. Confident and comfortable with the targets and the guidance that we gave. That's very helpful. Thank you. Thank you. One moment. For our next question, and our next question comes from the line of Mike Cikos with Needham & Company. Your line is now open. Hey, guys. Thanks for taking the questions here. The first question I had for you was really more macro in scope, and I believe it was in Yossi's opening remarks around how law enforcement agencies in Americas have historically demonstrated continued growth of budgets. That helps give you the confidence that these law enforcement agencies in the Americas can continue to grow their budgets in calendar 2023. Can you, I guess, discuss that a little bit more? And really what I'm curious is to hear how you've been communicating with your agencies and your various customers, and how deep you've gone in your conversations with them to ensure that budgets are continuing to grow. The second question I think is probably more for Dana Gerner, but it's with respect to the sales headcount growth. I know that you guys have said that the sales organization grew 10% year- to- year in calendar 2022. I think that part of the reason why you guys are talking to these EBITDA margin improvement in 2023 is based on the leverage you've spoken about. Can you help us think about what more investment needs to take place in that sales organization? How you guys are thinking about growing headcount in that organization as we look to calendar 2023? Thank you very much. You're welcome. Thank you for the question. I hope that you can hear me well. The conversations, you know, we've got today only in the public sector alone, more than 5,000 agencies. 5,000 agencies, 5,000 customers. I think that the number of meetings that we have done, and, you know, I'm very glad post-COVID here, was something between 15,000-18,000 meetings that we had with customers. I'm talking about only in those accounts worldwide that we manage with a dedicated account executive with a pre-sale and, let's say, visit and engagement with customer success. I can also say that we are in those few hundreds of accounts that we are managing directly with dedicated sales force and pre-sales. There is a very good dialogue on different levels. On a DFU, Digital Forensic Unit management level, on the INI, investigative and intelligence level, and also on decision makers, even on commissioner level. In all those dialogues, we hear the same thing, more funding. It's not, you know, overblown in terms of something that we haven't expected, but it pretty much correlates with the way we anticipated the allocation of budget to Digital Intelligence in that specific section. If you read our customer survey or our industry survey, you can see clearly that, and we published that, by the way, that the meaning of digital data within investigations is the most critical element of investigations in general. I'm also glad to say that the go-to tool is the mobile, by almost double in% than any other aim of digital source. Basically it's clear that if the meaning of digital data grows by more than 80% in the last three years when it comes to investigations are basically digital. We're pretty confident about that motion, we also see the increase in the budget by ourselves. This is to that, I hope that I helped. As for the sales force, maybe I'll hand over to Dana, before that, just saying, we are well equipped. We shared with the market the fluctuation that we had in Q1 and especially during H1 last year. We said already in Q3 that we are recovered. In that motion we are, we continue with the plan in a mix of a sales force which will manage multiple or a respectable number of accounts directly on the SLG side, on the federal side. We have also sales force, which is making sure that we get I would say new business and recurring coming from what we call the thousands long tail clients. Dana, would you like to add something on the sales force? I think we are, you know, very proud by the sales team members who joined in the second half of 2022. When we say that we are well equipped, that means that they are now fully boarded, and we expect them to be able to monetize their experience by bringing the right deals in place. We do not expect to grow substantially or in any manner the team, from a number perspective, it was really about getting the right people and the right quality to generate the revenue that we expect for this year. Thank you. One moment for our next question. Our next question comes from Tal Liani with Bank of America. Your line is now open. Hi, guys. First, I never say it on calls, but I wanna congratulate you on much better tone this quarter versus two previous quarters. I would like to ask you about the change. Last quarter, 2Q was weak, 3Q was mixed on foreign exchange. You reduced the guidance for 4Q by $4 million. Now you're beating the numbers by around $3 million. What changed from the previous guidance that you gave that you're beating the numbers by $3 million versus the $4 million reduction before? How much of it was foreign exchange? I know it was a tailwind for Israeli companies. Can you just talk about basically the environment and the delta from last year, or last quarter? Thanks. Sure, Tal. First, thank you very much for the kind words. Well, you know, we reduced our guidance during the Q2 earning call, and indeed, Q3 was very mixed with devaluation of the dollar to the European currencies, to the Israeli currencies. That had some impact on our forecast, and when we said that we'll be on the lower end, we assume that this trend will continue. Luckily or unfortunately, whatever it was, the currency mix remained pretty much the same through until the end of the year. As such, we have been able to meet our targets and even exceed the lower end of the targets, as we said we might be in the end of Q3. From a top-line perspective, on our ARR, we've been slightly better than what we expected. This was a direct result of the very well acceptance of our Premium as-a-Service, which contributed mainly to the ARR, lesser to the revenue because of it being a SaaS solution. As I said on my script, we took a very hard look into our OpEx, and we have tried to execute a caution approach towards OpEx expenses, including some adjustments and the true-up of variable compensation to the actual result compared to our beginning of the year initial targets. How do I think about the difference in trends? Two things. First, can you repeat your targets, your long-term targets that you gave it a year and a half ago, just repeat them so we have it in front of us. Second, how do I think about the difference between the trends in ARR and the trends in revenues? Revenues are accelerating. ARR, you grew in 2022 about 33%. You're guiding to about 1,000 basis points below that, so it's decelerating. What's the difference in the trends? Out of memory, our long-term ARR targets were 22%-27%, while our revenue targets were 20%+. What we have said is that during this transition from perpetual to subscription, we'll first see the growth coming in the ARR and later in the revenue. For the mid long terms, we'll see revenue and ARR trending the same. For that reason, as we are expecting our revenue growth to be on the 20%+ towards the end of next, of the end of this year, 2023, we would see ARR getting closer to the revenue targets from a growth perspective, as it will reflect basically the growth in the revenue, which is mostly subscription. Great. Thank you. Welcome. Thank you. One moment for our next question. Our next question comes from the line of Douglas Bruehl with JPMorgan Chase. Your line is now open. Hey, good morning, and thanks for taking my question. You had about 15 points of operating margin expansion quarter-over-quarter. Can you talk about the biggest drivers and maybe some commentary on timing for those OpEx cuts? Can you repeat the question? I wasn't sure I heard you properly. Yes. You had about 15 points of operating margin expansion quarter-over-quarter. Can you talk about the biggest drivers behind that and maybe some commentary on the timing for those OpEx cuts? The biggest OpEx. There are two drivers of OpEx, I would say controls in Q4. One of it was by the mere fact that as we said, we did not grow our headcount between the end of Q3 to Q4. As we said, also, when we've done the Q3 earning call, we believe that we've reached the right number of people in the company to meet our targets to end the year of 2022 and to start 2023. The second was relating to our variable compensation cost, which towards the end of the year, when we realized the final results of the company, we've aligned the variable compensation of bonuses and commission with the actual top line and bottom line results, generating some reduction, one-time reduction of cost of $4 million in the quarter. Okay, great. Thank you. Welcome. Thank you. One moment for our next question. Our next question comes from Jamie Shelton with Deutsche Bank. Your line is now open. Good morning. Thank you for taking my question. I wanted to get your view on the potential combination of Magnet Forensics and Grayshift by Thoma Bravo. What does this mean for Cellebrite from a competitive landscape perspective? Thank you. Um... I would say the following. First of all, I would say that currently potential merger, I would say should highlight actually the opportunity in the sector. I would say it is a clear statement that our market is attractive first and foremost. We probably or basically as a company which is larger than the combination of these two businesses, again, Thoma Bravo basically took two companies and I think collectively valued them in a $2 billion. That basically gives a sign or a clear mark of attractiveness to the market. This is first. In many ways, I would add we are not surprised. The two companies have collaborated for several years by now. I would say that from that context or from that concept, this is for us, a competition which was good, remained good. We have, let's say, our own way and our own path and our own roadmap. As we look, I would say to the rationale, the way it was explained, it even strengths basically our position because the rationale for the merger, at least from one of them, was about the fact that there is a mobile extraction capability, which is a reason, something that we have, shows basically how strong the mobile and how meaningful is the mobile. They define it even as a rare strategic opportunity. I would like to say that if I look at us at this stage, we are as a vendor, we combine in one house, the offering that these two players bring right now together. We have in our house offering which is extended to investigators and analysts, investigative analytics and OSINT. As a clear solution provider, we continue just extremely with our plan and continue to invest more in our solutions. Maybe the last thing, also position and expansion in the market was build an international footprint to expand our business in the U.S. and also outside of the U.S., and I would say already matured. I'm talking about us in terms of the expenses which are relating to that, something that we can create, at least on our side, more efficiencies. All in all, I embrace the move because it's good for our industry, but we stay firm with our direction. Brilliant. Thank you very much. Thank you. Our last question. Our last question will come from the line of Louie DiPalma. Your line is now open with William Blair. Yossi, Dana, and Andy, good morning. Good morning or good afternoon here. Indeed. Yossi, you announced 29 large deals in the fourth quarter, including that $14 million deal with the agency in Singapore. What does the pipeline look like for large deals in 2023? In general, are your deal sizes increasing as more customers adopt, your Premium Enterprise and, your other investigative analytics services? I will take it, and maybe there is some kind of a data in the mix, Dana, that I think that you can add. First of all, Louis, thank you for the question. It's the number of the larger or the larger size deals is growing and will continue to grow. This is basically a reflection of the size of the go-to market of Cellebrite, which focuses on increasing wallet share within existing accounts. This is mainly focused to the area of what we call the strategic accounts on the state and local government, and it is related to the federal side. Over there, it is expanding within the account, nurturing more, growing. As we offer more, and as the solution, each one of them or the total Digital Intelligence suite of solution resonates, we see basically more budgets, larger deals. Again, stating again, it will grow. Nevertheless, there is a dual effort here that we're doing because there is also the element of expansion within new logos. More related, I would say, to what we call the thousands long tail. We have them well identified. Over there, side by side, I would say with the Collection & Review within the larger accounts, there is a rather transactional Collection & Review business with a rather shorter sales cycle. We are still relying and facing a large amount of deals which are, I would say, small, reasonable, and pretty much fits our go-to market on that dual effort. Okay. Large deals on one side in expansion, then basically having that transactional solid base. This is good by the way, because that spread the risks of Cellebrite. We are not dependent on few customers. We are not dependent on few large opportunities. We have the ability to balance in that environment. Dana, would you like to add something regarding? Yeah. Hi, Louie. In principle. Hi. Yes, we do see in the last, two, three quarters that, looking at the larger deals, those who are above, which are above $500,000, some increase in the average mix, from a dollar perspective of those deals. Certainly we do. Excellent. Thanks, everyone. Thank you. Thank you. At this time, I would like to hand the conference back over to Mr. Yossi Carmil for closing comments. First of all, thank you all of you for participating, and thank you for the interest and for the questions. Again, I would like to say we are committed both to the results and the creation of shareholder value and obviously to the industry we serve. I'd like to thank again the Cellebrite employees for all the efforts in 2022, thank you. This concludes today's conference call. Thank you for your participation. You may now disconnect. Everyone, have a wonderful day.