Good day, and welcome to the 1-800-FLOWERS.COM, Inc. Full Year Q1 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 a touch-tone phone. To withdraw your question, please press star then two. Please note that this event is being recorded. I would like to turn the conference over to Joseph Pititto. Please go ahead. Good morning, and thank you for joining us today to discuss 1-800-FLOWERS.COM's Financial Results for our Fiscal 2022 First Quarter. For those of you who have not received a copy of our press release issued earlier this morning, the release can be accessed at the investor relations section of our corporate website at 1800flowersinc.com. Our call today will begin with three formal remarks, and then we will open the call to your questions. Presenting today will be Chris McCann, CEO, and Bill Shea, CFO. Before we begin, I need to remind everyone that some of the statements we will make today may be forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the applicable statements. For a detailed description of these risks and uncertainties, please refer to our press release issued this morning, as well as our SEC filings, including the company's annual report on Form 10-K and quarterly reports on Form 10-Q. In addition, this morning we will discuss certain supplemental financial measures that were not prepared in accordance with generally accepted accounting principles. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measures can be found in the tables accompanying the company's press release issued this morning. The company expressly disclaims any intent or obligation to update any of the forward-looking statements made in today's call, any recordings of today's call, the press release issued earlier today, or in any of its SEC filings, except as may be otherwise stated by the company. I will now turn the call over to Chris McCann. Thank you, Joe, and thank you to everyone for joining our call this morning. We are very pleased to kick off our fiscal 2022 year with strong revenue growth in our first quarter. As we mentioned back in our August call, the first quarter this year represented one of our most challenging year-over-year comparisons. This reflects the year-ago period surge in overall e-commerce demand, combined with the steep drop in marketing rates as much of the country was still in lockdown during the early stages of the pandemic. It's important to note that our 9% revenue growth in the quarter was on top of the 51.5% growth we reported in last year's first quarter and represents growth of more than 65% compared with our fiscal 2021 quarter. This illustrates the strong growth momentum that we have been building over the past several years as we have essentially doubled the size of our company, transforming from the collection of specialty brands into a unique e-commerce platform that inspires and enables our customers to express, connect, and to celebrate. As we had anticipated, the first quarter this year started out somewhat slowly in July and August as people across the country took advantage of the warm summer weather to act on their long pent-up desire to get out and about. As a result, we saw demand gradually ramp up as we headed toward back-to-school season, culminating in solid double-digit revenue growth throughout the month of September. This positive growth trend reflects the significantly increased recognition and relevance of our brands and our expanded product offerings for everyday gifting. For example, in our Harry & David brand, we saw double-digit revenue growth during the quarter in our sympathy, thank you, and our new encouragement collections, as well as continued strong growth for the award-winning Harry & David wines. In our Consumer Floral and Gifts segment, the double-digit revenue growth in the quarter was driven by the strong performance of Personalization Mall, along with continued growth in the 1-800-FLOWERS brand, including additional bundling of our best-selling floral arrangements with Shari's Berries products that are already proving to be customer favorites, in the expansion of our floral subscription programs, including additional frequency and duration options, along with a new self-service portal that allows customers to self-manage their subscriptions. In Personalization Mall, we further expanded our already broad product offering, adding more than 2,500 new items, including a new licensed personalized sports collection. During the quarter, Personalization Mall saw strong revenue growth for Halloween, back-to-school, travel gifts, and weddings, reflecting a strong rebound in those collections after being down last year due to the pandemic. We anticipate personalized gifts for travel and weddings to show strong growth throughout fiscal 2022. As we head toward the key holiday season, it's worth noting that Personalization Mall is in a uniquely strong position to meet growing demand from customers for the upcoming holiday season. We were able to stock up on our inventory items for personalization prior to the widely reported challenges that we see in the supply chain. In addition, we further expanded Personalization Mall highly automated production and distribution facility to increase fulfillment. Another area where we stepped up our efforts ahead of the holiday season is in corporate gifting, where we have further expanded our capabilities with the launch of our new Hero platform, powered by SmartGift. We continue to see strong growth across our brands in corporate gifting as companies across the country look for ways to stay connected with their employees and their clients in the new hybrid workplace. The Hero platform is now embedded in our existing corporate gifting portal, providing an engagement as a service offering that helps companies achieve their rewards and recognition goals, and gives them the ability to track their campaigns to measure their success and provide recommendations for future efforts. With the innovative Hero platform and our expanded product offering, we anticipate continued strong growth in our corporate gifting business for the holiday season. During the first quarter, we also continued to see strong growth in our customer file. We added 900,000 new customers while continuing to see strong demand from existing customers who represented more than 65% of our revenue during the quarter. We also saw continued strong growth in our Celebrations Passport loyalty program. This helps, as you know, to drive increased purchase frequency, retention, and lifetime value. Along with solid growth in new members, we saw a more than 50% year-over-year increase in customers, new and existing, using the Celebrations Passport program during the quarter. Celebrations Passport also continues to be one of the key drivers of strong growth in our best performing customer cohort of multi-category, multi-brand customers, which increased more than 15% year-over-year during the quarter. In terms of customer engagement, we continue to see great engagement in our e-commerce channels, where we are doing more to allow our customers to watch and learn and not just shop. During the quarter, we reached nearly 20 million engagements, an increase of 75% over the prior year period, and more than our entire fiscal 2020. We're doing this by creating more helpful content, social videos and events, recipes, cooking demonstrations to name just a few examples. We're also providing tips of how people can better express themselves when sending a gift. This is a valuable role that we play to enhance the gifting process and cement relationships. Our opportunity as we go forward is to continue to take this great content and weave it into our experiences to better engage with our customers, and you'll see us do more and more of this throughout the fiscal year. Regarding our current fiscal second quarter, which includes the upcoming holiday season, we are cognizant of several significant headwinds impacting the overall retail landscape. I'll ask Bill to cover these and our initiatives to address them in his remarks in just a moment. With that said, we believe the combination of the positive trends in our business that I've just described, along with our unique business platform, with our expanded product offering, and the tremendous momentum that we've built over the past several years, positions us well as our customers' destination for the solutions they need to connect, express, and celebrate with the important people in their lives. We are confident that this will enable us to drive strong growth in the current fiscal second quarter and achieve our guidance of double-digit revenue growth for the full fiscal year on top of the tremendous growth that we saw in the prior year. Now, before I turn the call over to Bill, I'd really like to take a moment to welcome the team from Vital Choice to the 1-800-FLOWERS family. As we announced yesterday, we are excited to have acquired Vital Choice, a trusted provider of exceptional quality, premium wild-caught seafood and hundreds of other great better for you products. This acquisition illustrates our focus on further expanding our offerings in the highly on-trend better for you food and gifting category. We look forward to integrating Vital Choice into our great family of brands and using the strength of our business platform to accelerate its growth going forward. I'd now like to turn the call over to Bill. Thank you, Chris. As Chris mentioned, we are very pleased with the start of our fiscal 2022. It's worth repeating that the 9% revenue growth we achieved in the quarter was on top of 51.5% growth that we achieved in the prior year period and represents 65.2% growth compared with the first quarter of fiscal 2020. Essentially, the first quarter played out as we expected, with soft demand in July and August, reflecting the increases in travel and other activities in the macro environment this summer versus a year ago, combined with the significantly higher marketing rates this year versus last year's record lows. As we expected, consumer demand improved significantly post Labor Day, and we are very pleased with the double-digit organic growth we achieved in September. When we provided our guidance for the full fiscal 2022 year back in August, we said that our first quarter revenue growth would be below the double-digit growth rate that we anticipate for the full year, and bottom line results for the quarter would be down year-over-year due to higher marketing rates and other cost increases. Our results for the quarter, both top and bottom line, were ahead of the guidance, illustrating the strength of our brands and expanded product offerings, particularly for everyday occasions. Looking ahead, as we move into the important holiday season, we are encouraged by the significant increase in consumer demand we saw in September, which has carried over into October, and we anticipate higher revenue growth and improved bottom line performance going forward. With that said, we are aware of several significant headwinds facing the overall retail landscape, including limited availability and increased cost of labor, rising commodity costs and higher rates of marketing, and a vexing combination of widespread transportation delays for components and finished products, along with significantly higher shipping costs. We have implemented several initiatives designed to mitigate the impact of these issues and enable us to take advantage of the strong e-commerce demand we anticipate during the key holiday season. These include strategic price increases across our brands and product offering, along with significant investments that we have made in our operating platform, including pre-building inventory, which leverages our expanded cold storage facilities and installation of automation in our warehouse and distribution facilities, which increases throughput and reduces our reliance on seasonal labor. As a result, we are well-positioned to help our customers connect and express themselves with the important people in their lives for both everyday occasions and the key holiday season and drive solid top and bottom line performance. Now breaking down some of the highlights from our first quarter. As we have noted, total consolidated revenues increased 9% to $309.4 million, compared with $283.8 million in the prior year period. Excluding the non-comparable five weeks of contribution from Personalization Mall, which we acquired on August 3rd last year, total consolidated growth was 4.3%. This growth was driven by strong e-commerce demand, which increased 10.3% for the quarter, including contributions from Personalization Mall. Consolidated gross profit margin for the period was 40.6%, a decline of 10 basis points compared with the prior year period. Operating expenses as a percent of total revenue increased 170 basis points to 47.1% compared with 45.4% in the prior year period. This reflected the higher marketing rates compared with the prior year period. As a result of these factors, Adjusted EBITDA loss for the quarter was $5.3 million compared with an Adjusted EBITDA of $3.2 million in the prior year period. Net loss for the quarter was $13.2 million or $0.20 per share, and adjusted net loss was $12.9 million or $0.20 per share, compared with a net loss of $9.8 million or $0.15 per share, and adjusted net loss of $6.5 million or $0.10 per share in the prior year period. Providing our segment results. In our Gourmet Foods and Gift Baskets segment, revenues for the quarter increased 8.4% to $97.5 million compared with $89.9 million in the prior year period. The strong growth was driven by increased demand for everyday occasions, illustrating the increased customer recognition of our brands such as Harry & David, Cheryl's Cookies, and Shari's Berries as highly relevant for everyday gifting occasions. Gross profit margin in this segment was down 390 basis points at 35% compared with 38.9% in the prior year period, reflecting increased costs for labor and transportation. Importantly, we have already implemented a series of strategic price increase initiatives as well as other strategies to help offset the increased labor and transportation costs going forward. As a result of these factors, as well as higher year-over-year marketing costs, segment contribution margin for the quarter was a loss of $7.7 million compared with a loss of $2.6 million and an adjusted loss of $3 million in the prior year period. Now Consumer Floral and Gifts segment. Total revenues increased 12.2% to $181.2 million compared with $161.5 million in the prior year period. Excluding the non-comparable five weeks of contribution from Personalization Mall, total revenues increased 3.9%. Gross profit margin increased 130 basis points to 41.9% compared with 40.6% in the prior year period, primarily reflecting contributions from Personalization Mall. As a result, segment contribution margin was $19.2 million, essentially unchanged compared with the prior year period. This primarily reflected increased marketing costs offset by the incremental contributions from Personalization Mall. In BloomNet, revenues for the quarter were $30.8 million, a decline of 5.8% compared with $32.7 million in the prior year period. This reflected delays in hard good shipments as well as a reduced order volume from third-party online floral companies. Profit margin increased 470 basis points to 50% compared with 45.3% in the prior year period. This reflected product mix with lower shipments of wholesale margin hard goods and fewer low margin orders from third-party floral companies in the quarter. As a result, segment contribution margin increased 4.2% to $10.9 million compared with $10.4 million in the prior year period. Turning to our balance sheet. Our cash and investment position was $3.8 million at the end of the first quarter, seasonally low as we prepare for the holiday period. Inventory was $282.4 million compared with inventory of $192.6 million at the end of last year's first quarter. The significant increase in inventory reflects a conscious effort on the part of our management team to invest early to pre-build inventory to mitigate the supply chain and seasonal labor issues we are seeing across the retail landscape. In terms of debt, we had $181.8 million in term debt and zero borrowings under our revolving credit facility. Now regarding guidance, we are reaffirming the guidance we provided in our August call for the full fiscal 2022 year, which includes total revenue growth of 10%-12% compared with the prior year. Adjusted EBITDA growth of 5%-8% compared with the prior year. EPS in line with fiscal 2021 as improved EBITDA is offset by higher depreciation and a higher effective tax rate and free cash flow to exceed $100 million. I'll now turn the call back to Chris. Thanks, Bill. To sum up, we are very pleased with the strong growth that we achieved in our first quarter against what was a challenging comparison. This reflects the significant momentum that we've been building in our business for the past several years. That stems from our laser focus on providing our customers with an expanded range of solutions designed to help them stay connected and express themselves, sentiments that are more important than ever today. This is combined with our ability to leverage our unique e-commerce platform, which includes our all-star family of brands, our advanced technology stack, our manufacturing, distribution, and logistics capabilities, our digital marketing expertise, and of course, our growing customer file. As I mentioned earlier, and it bears repeating, over the past several years, we have doubled the size of our business and significantly transformed our company, becoming a unique e-commerce platform that inspires and enables our customers to express, connect, and celebrate. As such, we are well-positioned to continue to deliver strong growth going forward. Our guidance for this year and our outlook for continued strong growth in the years ahead is based on several factors, including the significant increase in consumers shopping online, a trend that we do not see going backwards. The significant expansion of our product offering, both organically and through strategic acquisitions like Personalization Mall, Shari's Berries, and now Vital Choice. The significant growth of our customer file, along with continued positive customer behavior trends and the continued strong growth in our Celebrations Passport loyalty program, which is helping to drive increased frequency, retention, and lifetime value. In addition, I am extremely proud of our team, all our associates across the company who have continued to overcome the challenges that we have seen and continue to see in the macro environment. We've done this through a combination of hard work and innovative thinking that have become the core of our culture as a company. Looking ahead, we are well-positioned to deepen the relationship we have with our customers by engaging with them across a broad range of communication channels as we work to build a true community and offer our customers the most robust online gifting assortment. We are confident that we will continue to drive long-term shareholder value as we continue to leverage the strengths of our platform. Now, I'd like to turn the call back over to the operator so that we can take your questions. Thank you. We will now begin the question and answer session. To ask a question, you may press star then one on your touchtone phone. If you're using a speakerphone, please pick up your handset before pressing the key. If at any time your question has been addressed and you would like to withdraw your question, please press star then two. The first question is from Michael Kupinski with Noble Capital Markets. Please go ahead. Thank you, and congratulations on your quarter. Just a couple of quick housekeeping things and then a couple of other questions. Does the revenue guidance include Vital Choice? Yeah, Michael, it does. We didn't adjust our guidance because of you know the size of you know Vital Choice. You know, Vital Choice is on an annual basis about a $25 million revenue you know business. We expect as we integrate it you know to accelerate its growth and you know double-digit growth you know going forward. It obviously may add a point to annual revenues at those numbers, so we didn't change our guidance as a result. Okay. Can you just kind of give us a sense of how Vital Choice performs in a quarter? Is it profitable each quarter? You know, just kind of give us a sense of how it performs. Yeah. About 30% of its revenue is normally in the holiday quarter. We're, you know, picking it up, you know, effectively one month into the quarter. So, you know, a pretty minor impact on, you know, on this quarter. Okay. Does the supply chain issues affect any one of your segments more so than the others? The supply chain issue affects more of our wholesale business than our e-commerce business. You know, primarily, you read a lot about the significant issues on ocean freight. You know, we're not as susceptible to the ocean freight issues and the imports from Asia that many companies are. A number of our wholesale products do come in from there, so it affects that piece of business. If you remember, that's about a, you know, maybe a 5% component of our overall revenue, so it's not a big piece of our business. With that said, you know, we are feeling some pain with regards to the supply chain issues. Again, as you said, Bill, mostly in the wholesale channel more than in the e-commerce channels. Gotcha. Then, I'm hearing supply chain issues are starting to affect the economies of the larger markets in the U.S., which in turn is affecting advertising. Are you seeing? I know that advertising is up year-over-year in marketing and so forth. Are you starting to see marketing rates begin to drop a little bit, as you kind of head into this quarter? We have not seen that yet, Michael. As you just pointed out, marketing rates had returned to normal. We don't face the same headwinds that we faced in the past quarters, as we look at this year. We're optimistic that we see marketing rates start to, you know, drop a little bit, but we have not seen that at this point. The company has historically been very good at, you know, in terms of the price elasticity to raise prices during periods of inflation and things like that. I was just wondering, do you think that this is a little different than the times that you've seen in the past? How receptive have consumers been to the price increases that you had on some of your select products and things like that? Can you just kind of give us a sense on how the consumer is reacting? Yeah. We've been taking, as Bill pointed out in his formal remarks, price increases where we can and doing so strategically. As you point out, that we've done very effectively in the past. At this point, I think we're seeing consumers respond appropriately or respond favorably to the price increases that we've taken, and we're certainly looking at the opportunities going forward. The market is being shaped by what we see in the general press, and the consumer is seeing that there are price increases coming. That's also helping the consumer to step up and start to order early as well, as we're seeing that as a general message in the macro community. Yeah, Michael, we have dynamic pricing, so we have the ability to adjust pricings up, look at you know how that's impacting conversion and adjust it back if you know if need be. But as a you know kind of a macro comment, you know we saw a softer consumer demand in July and August, what we expected and what we guided to you know back in our August call. We expected, and then we saw a nice uptick in the business you know post Labor Day, as you know kids went back to school, everyone went back to you know back to work. We saw double-digit growth in the month of September. That's continued into October. That's at the time that we really started to, you know, implement some strategic pricing, right? We didn't do it in July and August when consumer demand was a little softer, and it did not impact, you know, demand. Gotcha. Thank you so much. Appreciate all the questions. Thanks. All right. Thank you, Michael. The next question is from Dan Kurnos with The Benchmark Company. Please go ahead. Great. Thanks. Yeah, good morning. Chris, I guess just as we think about, you know, some of Mike's comments on advertising and marketing. Obviously, the pressures haven't abated. If anything, performance has gotten messier given the supply chain issues and kind of maybe competing down funnel. You guys have been pretty flexible with your sort of go-to-market strategy. The interesting thing is, even with elevated rates, you guys are seeing still strong growth. Maybe kind of two-part question, which is, one, you know, how are you thinking about channel spend going into the holiday period? And two, obviously, you spent a lot of money over the past couple years sort of building your moat here and taking share, but you're seeing maybe the fruits of that labor now. Is there, you know? Are there any thoughts to kind of starting to let some of the growth just flow through here, you know, maybe since the inefficiencies are gone? Or, is it really just more a reallocation to different channels, as we think of, you know, going into 2022 here throughout the course of the year? Thank you, Dan. As we look at things, just to your first part of your question, really, you know, on how we look at the different channel spend. First and foremost, as you pointed out in your question, we're very good and we have good flexibilities. Even as Bill discussed on the dynamic pricing point, we have the same capabilities really on our advertising spend for the most part. So much of our advertising spend is in the digital channels, and we can dial back and dial up as we're seeing the effectiveness move up and down. I think, you know, we continue to look at especially our lead brands moving more upper funnel, where we're starting to do more, you know, TV, whether it be connected TV, linear TV. We're seeing good opportunities in those markets right now. That's broadening our capabilities. As you get really into the closer to the holiday, it becomes more kind of lower funnel and where we can really be flexible and take advantage of the efficiencies that we see in the market. To your point on building the moat, you know, we see the opportunity to continue to grow the business, that I think, you know, as things become or even this holiday season, we expect it to be less promotional. That provides us some opportunity as well. We're in a growth mode right now, so we're looking to see where we can expand that moat and how we can continue to grow our customer file. As I pointed out in my remarks this past quarter, we grew our customer file, you know, by 900,000 people. At the same time, 65% of our revenue still came from existing customers with good metrics from our Passport customers, good metrics from our multi-brand customers, multi-category customers. We're continuing to lean into that. Got it. Maybe just to kind of follow up on that, at the risk of being wrong on my math here. I still think in the September quarter, if you exclude PMALL from both periods, you still had some, I don't know, 4% consumer floral growth off of, I don't know, a 55% or so growth last year, something like that. You have tremendous kind of underlying momentum. Bill, feel free to tell me I did that wrong. I guess I'm just trying to understand, you know, how much of that is sort of marketing driven? How much of that is, you know, Passport? How much of that is just kind of innate expansion of product lines here? Just do you feel the need to continue marketing at the same level to maintain that growth? Do you have kind of substantial momentum where the investment in product expansion and things like Vital Choice becomes maybe more of a better lever to continue driving the elevated growth rates you're seeing? I don't think Bill's gonna correct you. I think your math is fairly accurate there. I think to your question, it really is overall, and it really is the momentum that we've been building up as we've been speaking about not just in the Consumer Floral, but the momentum we've been building for several years in our businesses, and really leveraging the platform. When you look at different product expansions, we talk about the Shari's Berries product expansion and how that really you know, leveraged our platform and is helping to drive some of this momentum or innate growth that you referenced. Vital Choice will be similar. We'll bring that product line onto our platform, look to accelerate its growth capabilities, bring that product catalog in with the Harry & David, you know, gourmet line, which is such a nice complementary fit. It's the customer base that we've had, that we've built up over time. It's the product expansion, the Passport numbers, everything kind of working together to give us that momentum. Okay. Fair enough. Dan, just with your You go ahead, Bill. Dan, just with your numbers both on Consumer Floral and overall, you know, we highlighted it in the formal remarks, but you know, overall 9% growth on top of you know, last year's over 50% growth, which got us a 65% growth over two years ago, kind of very similar numbers in the Consumer Floral category. Yeah, over 4% organic growth in Consumer Floral on the 1-800-FLOWERS brand over last year's well over 50%, bringing us 60% growth over two years ago. Yeah. No, it's an unusual storyline in this market to the upside. You know, you guys should be commended for that. Thanks for all the color. I appreciate it. Thank you, Dan. The next question is from Linda Bolton Weiser with D.A. Davidson. Please go ahead. Yes, thank you. Hi. Can you just comment on is there any issues at all in terms of supply chain with availability or pricing of flower supply? Are you seeing anything unusual there? I wouldn't say very unusual, Linda. There have been challenges, as was reported last spring, just in you know really mostly in the freight side of the flower availability. There's some small challenges, just like we're seeing in every sector. We've got that under control. We've mitigated that. We're in good inventory position as we go forward into this coming holiday season. Okay, great. Maybe I missed it, but did you actually give the increase in the number of Passport members, the year-over-year increase in the quarter? No, we did not break that out on a quarterly basis, but I would say that we're continuing to grow Passport at double-digit rates. What's really important that I pointed out in my remarks is, if you look at Q1, we saw a 51% increase in customers, both new and existing, utilizing the Passport program. That's a good metric that really shows the traction that Passport is gaining in our everyday sales. Okay. In terms of Vital Choice, how integrated will you be able to get it in time for the holiday season? I mean, is it going to be, you know, completely integrated on the multi-brand platform? Like how much progress can you make on that by the holidays? Yeah. At this point in time, Linda, thanks for that question on it. As you've seen us do in the past, the first thing that we do when we look at an acquisition and on the integration plan is don't mess with the existing business. As we move into the holiday season, we won't rush things there. What you'll see us do is merchandise their top-selling products within the Harry & David gourmet line. That's about the extent that you'll see in addition to, you know, starting to do some, you know, customer database exposure, et cetera. From an integration point of view, very limited pre-holiday and really focused from a merchandising on our platform point of view. Okay. I had a question just about the longer term. You know, you had a target of a 10% EBITDA margin for several years, and you've hit it. You've been successful in that. Going forward over the next few years, are you seeing that you're more of a top-line growth story with more of a flattish EBITDA margin? Or do you think there can be some EBITDA margin expansion beyond kind of this 10% level? Yeah, Linda, I think over the longer term, we do see that there is, you know, the ability to improve our EBITDA margin, whether it be on the gross margin line or even on the, you know, the OpEx line over time. As you know, Passport becomes a bigger component, as multi-category purchases become a bigger component of our revenue, more revenue will come from our existing customer base. Thus there'll be some leveraging on the marketing side of the business. We do think over time there will be an expansion in the EBITDA margin. That's as we get benefits from the overall platform that we've built, as Bill said, both on the marketing side, the customer database side, as well as the operations capabilities, the automation we're building into our platform, et cetera. The more we invest and build that platform, the better you'll see returns in the future. Okay, great. Just finally, I mean, with your guidance for double digit growth, revenue growth for the year, I think if you look at street estimates, you know, there is an expectation for double digit revenue growth in the big holiday quarter, the second quarter. Are you seeing that that's possible with the trends you're seeing now? You know, is that the ballpark range of what you're kind of expecting for the holiday quarter? Yeah, Linda, you know, by reiterating our guidance of 10%-12% growth for the year, with where we were below that in Q1, you know, the remainder of the year, we certainly have to be at the double-digit level with Q2 being our largest quarter by a significant margin. We do expect to achieve double-digit growth in the second quarter. Okay, great. Thank you so much, and good luck with everything. Thank you. Thank you, Linda. The next question is from Alex Fuhrman with Craig-Hallum. Please go ahead. Great. Thanks very much for taking my question. You know, obviously it sounds like you guys have a really good handle on the supply chain, given that you're reiterating your guidance for the full year. You know, as you look at the headwinds that you are facing and the obstacles ahead with the supply chain, what are the areas that you're most concerned about? Are there any overseas inputs that are critical to the construction of your gift basket and towers? Are there any concerns about perhaps outbound shipping delays risking some of your fresh products spoiling in transit? I guess just from a big picture, are there any concerns about being able to fulfill orders and meet demand for holiday? Is it really just a matter of having to pay a little bit more for things like labor and shipping? Alex, that's a mouthful. Supply chain is all over the news these days. You know, certainly the ocean freight side of it gets a lot of news. You know, luckily, we're less susceptible to ocean freight than many other companies as we don't import a significant amount of items from Asia. With that said, we are susceptible to it, and it does impact the wholesale part of our business more than the e-commerce. It really doesn't have much impact on the e-commerce. When you talk about supply chain, there's a lot of factors there, right? There's the ocean freight, there's trucking, there's trucking availability, and there's outbound freight. It's a wide category. You know, this is why we've been investing for a number of years, you know, in automation. We wanted to lessen our reliance on seasonal labor, but also be able to get ahead of some of the challenges. You saw on our balance sheet, you know, that our inventory is up $90 million over a year ago, right? That's a comp to comp, right? We already owned Personalization Mall, you know, a year ago. That was a conscious effort on management's part to bring the inventory in early to put us in a better position than we were a year ago, and to address some of the issues with you know, with supply chain. There are certainly you know, headwinds out there that that will keep Chris and I you know, up at you know, up at night. We think we're in you know, a pretty good position as we head into the important you know, two months you know, ahead of us and why we're confident and reiterated our guidance. That's terrific. Thanks, Bill. The next question is from Douglas Lane with Lane Research. Please go ahead. Oh, yes. Hi, good morning, everybody. Just talk about the December quarter, the holiday quarter. If I remember right, there were capacity constraints a year ago quarter. Where are we on those capacity issues? What have we done to alleviate them to free up some demand requests this quarter that maybe weren't fulfilled last quarter? Sure, Doug. There's a couple of things there, and Bill, I'll ask you to chime in as well. As we looked last year, some of the capacity constraints that we were dealing with were more on the inventory side than pure capacity, you know, capabilities. As Bill pointed out, we've addressed and looking to mitigate that with the increased inventory position that we're in. In addition to that, we've built in automation into some of our distribution facilities to increase throughput. I mentioned some of the new equipment we added in to, for example, our Personalization Mall to increase fulfillment capabilities there. In addition, as Bill pointed out just a minute ago, the additional inventory that we brought in at Personalization Mall, the new items, over 2,500 new items that we've introduced at Personalization Mall. Those are most of the things that we've done to really address those issues. Bill, anything else you think of? Yeah, I mean, you know, obviously from an operational standpoint, this is you know very fluid, right? It's you know a tough environment, both from a supply chain and from you know from a labor you know availability. But that's again why we you know did a lot of the things that Chris just you know spoke about from an inventory standpoint, from an automation you know standpoint to put us in the best position we could be in to take advantage of you know what we believe is going to be you know pretty strong consumer demand as we head into Q2. We do also get a little bit of a benefit of a shift from Q1 into Q2 on some wholesale you know orders. We spoke about it with, you know, BloomNet. Because of supply chain challenges on that wholesale product, you know, we have some orders that typically would have gone out in Q1 that are gonna come into Q2. Okay, that's helpful. Thank you. While we're on Personalization Mall, we anniversary the acquisition, so we're gonna lose visibility on the numbers there. You know, as far as I can tell, the growth there has been more than double digits. It's been something circa 30%. So I don't know if you wanna confirm that number and tell us what kind of growth rates you're seeing on the top line. Personalization Mal l, Doug, as you pointed out, continues to perform very well. We continue to increase the capabilities there, new product introductions, the inventory position we're there. We're very comfortable with its continued growth rate, as you mentioned. On the integration, is it fully integrated or are we middling? I mean, where do we stand there? There's still integration to be done there on some, you know, on some of the technology platforms, et cetera. One of the big things that we did this past quarter or recently anyway, was really integrating their product catalog. Everything's in their whole product catalog is integrated with our product information management system. What we're seeing now is much more cross-merchandising being done across our other brands of the Personalization Mall product. That's one of the most recent and significant achievements in the integration plan. The next question is from Timothy Rangel with Northcoast Research. Please go ahead. Thank you and good morning. Only one question after Alex and Doug, you know, got some good color from theirs. It is on Vital Choice. You know, it is a small tuck-in acquisition. I know you guys have, you know, Stock Yards already on your kind of product offering. I was wondering if this kind of better-for-you category, you know, is kind of the new target vertical for you. If you guys could maybe size that vertical. I don't know. I'm not very familiar with what, you know, that kind of market looks like. I was just wondering if you could provide some more color on, you know, why you're targeting, you know, the better-for-you category, what you like about it. if you could, you know, maybe size it a little bit, you know, better for us. Thanks. Sure. Thanks for that question, Tim. As we look at the better-for-you category, we've been in that category already with some of the product line from Harry & David, whether it be some organic food or organic capabilities, organic vegetables that we've had. We've had some from Cheryl's gluten-free cookies, sugar-free cookies, et cetera. It's a category that's been on trend for a while now and continues to be a hot trend, and especially after a younger demographic. So when we saw the opportunity with Vital Choice, it's more than just a product expansion for us, which again, the product is just fantastic and it's just a great product and well-positioned, but really positions and it's a brand that we think we can grow into the better-for-you category. I don't have the numbers off the top of my head, but it's a very large category for us to grow into, and for us to continue to expand our footprint and our position in there. We're pretty excited about that. If you take a look at the Vital Choice site, if you've had a chance, you see how they really promote the whole better for you, the healthier, you know, conscious aspect of wild-caught seafood and sustainably farmed shellfish. That flavor of branding and positioning is what you'll see us do with as we expand the Vital Choice brand over the coming years. No, I appreciate that color, and something maybe we can expand on later. One other kinda quick question. You know, supply chain issues of last year, you know, wholly different, I think, than this year. I think last year it was more fulfillment due to all the e-commerce demand. From my notes, I have, I think, a number you guys gave us last year, which was, you know, I think you were able to fulfill 96% of your orders. I was wondering, you know, what a normal metric is for fulfillment, you know, of the orders you get, and if you feel comfortable that you're gonna get back to, you know, 100% or whatever that normal fulfillment rate is, you know, this holiday. Thank you. Yeah, Tim. I mean, we did discuss last year that in December we left demand on the table. The combination of the availability of inventory as well as FedEx capacity issues. We have worked very hard with FedEx throughout the year. We do feel confident that FedEx will be able to fulfill the demand that we have. You've heard us talk about some of the supply chain and labor issues with the strategies we've implemented to offset that. We think we're in good shape, but you know, this is a top operational environment to be in. So we're gonna do our best to fulfill every order that we can get. All right. Thanks, guys, and good luck. Thanks, Tim. This concludes our question and answer session. I would like to turn the conference back over to Chris McCann for any closing remarks. I'd just like to thank everyone for joining this morning, and we appreciate your comments and your questions. If you have any additional follow-up questions, please don't hesitate to reach out. We'd be glad to engage. I urge all of you to try our new product line from Vital Choice. I guarantee you'll love it. Thank you very much. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.