All right, I think we'll kick off here. Good afternoon, everyone. So I'm Tom Champion, Piper's internet analyst. I'm joined today by Mike O'Donnell, CRO at VIZIO. He's joined by Michael Marks from the finance and IR team. And we've got about 25 minutes, so not too long here. And I'll open it up to the audience if there are any questions. I guess, you know, Mike, so great to have you here. Yeah. Thanks for having me. Your initial role at the company, your legacy, your experience is in the ads business. So I'm wondering if you could just level set for us and talk a little bit about what you're seeing in the ads market, maybe, you know, by vertical as well. I think, you know, media's been somewhat challenged. There have been other verticals- Yeah That are healthier. Just, what's the landscape and what are you, what are you seeing? Yeah, I think I speak with regards to us. I mean, I think if you go through the year, Q4 itself of last year was kind of a rough quarter, right? So, so we're a little nervous about the start of the year. January was a little bit rough. February started to pick up. We ended up finishing Q1 up about 20% year-over-year. Q2, we were able to keep that momentum. We finished about 35% up. And, you know, we're pretty optimistic about the back half of this year with the trends we're seeing in the market. I think when you look at the growth, you mentioned media and entertainment. Media and entertainment is challenged right now, and it's challenged because of the writers' strike. I don't think that's any secret. From our perspective, that's kind of a short term; it's a timing thing. Once that's over, those dollars will come back, but it will have a short-term impact on us. Where we have seen good growth, where we got to 35% in Q2 and we're optimistic, is we're seeing growth in our ability to kind of diversify into what we call general market. So, beyond media and entertainment, you know, we saw triple-digit growth in automotive in Q2. We saw triple-digit growth in pharma. We saw triple-digit growth in QSR, right? CPG was up almost 100% quarter-over-quarter. So, I think the team has done a good job of diversifying into additional categories, because if you remember, we're really in our third year in terms of monetizing our platform. We still have a lot more runway. We've gone from, I think two years ago, we were at $14 in ARPU. We're now closing in on or we're over $30 in ARPU, and, you know, we still got a pretty good run rate ahead of us as we continue to build up those relationships. Okay. Maybe walk us through where we are in this transition to CTV off of linear. It's clearly an interesting time. Yeah. Look, I think this writers' strike is doing nothing but helping to kind of accelerate that shift out of linear television into connected TV. I think you're- as I mentioned, we've still got a lot of runway ahead of us, and there's a couple of reasons for that. I think you've seen the market, right? It was expecting kind of $25 billion, I think, this year, some say, in connected TV, next year, $30 billion. But when you look at the overall market, only 55% of households have smart TVs today. That continues to grow year on year. So the market will continue to expand. And then from our perspective, it all comes down to engagement, right? How much engagement are you going to have with that smart TV and streaming? I think we shared in Q2, we saw on our own platform, 56% of time spent was spent streaming within our SmartCast environment. That's compared to linear, which is dropping now, some studies say below 30%-28%, in terms of time spent, you know, and that also includes gaming consoles and sticks and dongles, which are dying off slowly. But when we look at all those statistics, you see, you know, the opportunity for connected TV is there today, but it's very significant as we close that gap in the future between amount of time spent and amount of dollars that have shifted over. Just, within, ad verticals, I guess, you know, something I wanted to ask you about is just the, you know, political- Yeah and we're obviously going into a cycle. CTV has some characteristics- Yeah attached to it that make it favorable for that vertical. Yeah. Can you talk about that a little bit? Yeah. So political from a CTV perspective in general set up very well, right? The ability to target, but also the ability to target to very specific DMAs on a granular basis is super useful for political advertisers. In terms of VIZIO ourselves, we're pretty excited about this upcoming season and really about 2024. I mean, we talk about being kind of still somewhat early days in terms of advertising. In 2022, right, we were only two years in, we weren't set up that well to capture political dollars. We used a lot of third parties. Since then, you know, we saw some of the missed opportunity there, and we were able to go out and we started to build up a team down in D.C. We started to build those relationships the way we have with general market, media, entertainment, down in D.C. with all the political agencies. And I think for us, it's a significant growth opportunity, not only because the market will continue to shift more that way, but I think we're better set up to take in the demand that's going to be out there. Okay. Interesting. Yeah. Is that a long-term growth opportunity, or do you expect to be able to monetize that with the- With the upcoming election this year, we see it as an opportunity, but 2024 will be a much, much bigger opportunity, right? I mean, that's where there will be some dollars spent this year, but 2024, like 2022, there was a significant amount of spend coming into not only the market, but the connected TV market specifically. We didn't capture candidly, we didn't capture what I think should have been our share 'cause we weren't set up well. We were still relatively new to the market. We are now very well prepared to capture those dollars as we move into this year, but really, as we move into the big opportunity in 2024. Mike, can you talk a little bit about this year's upfront? It seems like it was a little sluggish getting closed. Yeah. You know, I don't know if it relates to this uncertainty with the dynamics of the linear to CTV- Mm transition, what all the factors might be, but, you know, kind of what did you make of the upfronts and- Yeah You know, what's kind of your editorial comment on it at this point? Yeah, I think they're slowed down a little due to the writer strike, the overall upfront marketplace. But from our perspective, we're not ready to share a number, but, you know, two years ago, we did $100 million, right? Last year, we did $200 million, so we doubled. We expect to significantly grow that upfront commitment in this season, and by all the relationships we have, the conversations we have, the deals that have been struck thus far. So I think connected TV, and specifically VIZIO, is very well positioned to grow the upfront market or our share of the upfront marketplace. I also think it's gonna lead to a lot more dollars in the scatter market, that will be up for grabs, and I think CTV is well positioned to capture a lot of those as well. Sort of a tangential, but maybe related, I mean, just curious your reaction to this recent dynamic with Disney and Charter. Yeah, I mean, I think i t is definitely will shift the relationships moving forward. I think it shows, one, the impact that streaming has on linear television, but really the negotiations between the cable providers as well as the content providers. But what I think it does signal is that it's really great to be in distribution, right? And when we look at VIZIO and you think towards the future, today, we're, you know, closing in on 18 million thirty-day active users. We've got massive distribution. I think it showcases the fact that distribution is critically important, and I think we're set up very well for that for the future. Okay. I'd like to transition a little bit and talk a little bit about the devices as well. Yeah. It's been a very difficult environment with aggressive discounting that, you know, I think the general thought is that that was expected to continue into the back half. You know, what are you seeing with the consumer and, you know, does that discounting dynamic remain pervasive? Yeah, I think there, you know, it's been a marketplace that has been, we'll call it, somewhat of a price war. I think we've shared that publicly out in the marketplace. It's been aggressive. We expect it to be aggressive through the back half of this year. From our standpoint, though, you know, we've been in this 21 years now, heading into year 22, so we know the hardware market extraordinarily well. We've got long-standing relationships with all the major retailers. But when we look at the transition we've made in this business, for us, our focus isn't necessarily on selling as many televisions as possible. It's focused on selling more of the right quality televisions for us, and those quality televisions are the larger screens that sit in the living room, that get more engagement, get more time spent, 'cause it fits our business model a little better. So this year, we have put way more of an emphasis on moving into the larger size of the market, and I think if you see Q2 and those results, I think we've done a very good job of that. We had the number one 50-inch selling television in the marketplace. We had the number one 65-inch selling television in the marketplace in Q2. And for us, those larger size models will continue to be the focus because those televisions drive more engagement, and the more engagement ultimately helps us drive more output. Got it. Okay. Maybe you could talk a little bit about competition and market share, you know, those dynamics in the first half of the year. And then, you know, within market share, do you bifurcate the market? Do you think about it in terms of, like, VIZIO's share within 50-inch and above, like, that. You know, is it that type of segmentation analysis that is Mm-hmm Kind of how you evaluate your success? Yeah, I think we look kind of to that point of focusing more on larger size. I think we look a lot, not at lifetime value of the television, right? And what we see is there is much more of a lifetime value or a larger lifetime value from the bigger sizes, right? The ones that sit on the wall, either in the living room, the bedroom, get a lot of use, get a lot of engagement with them. Those give us the opportunity to monetize a lot better. Okay. Well, let's talk about the platform business and some of the product changes, you know, made in the platform business and specifically around, I think a recently introduced new home screen. Yeah. Can you talk about, you know, what that is, the CPM and maybe inventory implications of the change? Yeah. So our home screen is, it's the first thing the consumer sees when they turn the television on, right? It's critically important to us, driving engagement. Search and discovery, I think in Q4, we shared a data point that said it was up over 70% year-over-year. Search and discovery is becoming more and more important. So when someone turns on the television, they see that home screen. That is, for a consumer, the best way for them to identify what's the best available content for them on the platform at that time. And for an advertiser, you know, we'd call it, we've used the term before, you know, last gas station for 40 mi. It's the last opportunity you have to try to drive someone into your app before they go potentially get lost in somewhere else for four hours binging, right? So it's critically important for both the consumers as well as our advertiser base. So we got a lot of feedback over the years. We had what I believe to be the best UI for search and discovery in the market already, but we had that same, same format for, I don't know, it was five or six years, right? So we wanted to freshen it up. We wanted to make it increase the look and feel, make it more dynamic, be able to add more video into the home screen experience. We did that. We executed this redesign, and what we've seen is it's been very well received by the consumers. We saw immediately engagement rates go up 22% in terms of time spent searching and discovering through our home screen just after the redesign, right? That's really important, both well received by the consumer, also very good for the advertising base we have. And I think for us, when we look at that, when you roll out a new product, there's a couple things that go into it. One, you want the consumers to like it, and I don't know if we've shared this before, but usually whenever you change something for the consumer, you would get a ton of calls to customer service. They just don't like change, especially the first thing they see when they turn the TV on. We got nearly barely any calls, almost zero, and the calls we did get were commenting on how well they liked the new redesign. So, not only do we roll it out on new televisions, but we've also now gone backward compatible- Okay To all past TVs that have the SmartCast experience. So, one of the benefits of the VIZIO platform is when you buy the television, right? That typically sits on the wall for five to seven years, right? We wanna make it get better every day you have it. So we use all best efforts for every new product innovation, every new redesign, every update we make to the OS, we go backwards compatible to all SmartCast, all SmartCast customers. And we're doing that today with the redesign. Okay. So just to clarify on that point, that new home screen rolled out in, I wanna say, like, you know, May, June time frame- Yeah or something like that. Yeah. And then what is, what is that, refresh backwards compatibility cycle, process? Like, how, how long does that take? Yeah. So, we are now in September. We are out... I don't know, the specific percentage, but I would say we are more than three-quarters rolled out backwards, and by the end of the year, we expect to be fully, fully rolled out. Got it. Okay. Okay. VIZIO Account. Yeah. You know, that was an important initiative- Yeah To incorporate payment rails into the- Yeah Into the device, into the account base. Can you talk a little bit about that and where we are with VIZIO account? Yeah. We're not sharing specific numbers, but just to talk about account itself, to refresh the group. VIZIO Account is our, effectively our, our account sign-in, as well as billing engine that we can enable. So you could make purchases, subscription, transactions, et cetera, through the television. Candidly, we had been behind. Not something we had built back when we first rolled out SmartCast, so we rolled it out about a year ago, so we had some catch up to do. We were very, very pleased with the amount of account sign-ups we've had, right? It's a little more challenging to go backwards and get people who hadn't signed up to go put their billing information in. But over the past quarter, I think we've seen 40, we have about 40% of all the apps on our platform now are integrated with VIZIO Account. And we've seen over the past quarter, 20% growth in terms of the number of users that have now put their credit card in and are making purchases on the television. So we're happy with the trajectory that it's on, and it's a big initiative for us moving forward. We'll continue to invest and continue to grow that relationship with our customer. Got it. I'm really interested in the branded content studio and partnership with- Yeah With BetMGM. I think specifically in this VIZIO account context, but, you know, maybe you could just talk about the partnership a little bit. Yeah. So from our standpoint today, you know, we don't make large investments in original content. Today, we're pretty disciplined about our use of capital, and we don't feel where we're at, it's the right use of capital for us. That said, we want to provide original content to our customer base. So what we've done is we've gone out and built this branded content studio. We've built relationships with studios and content providers in the space. We've leveraged the data we have on the platform. So we have Inscape data, which is our TV viewing data, a technology we have built into the television that recognizes anything that kinda hits the glass, so we can understand what our consumers are watching, whether it be in linear, by TV show, by network, ads, we can recognize within a streaming environment what they're watching. We take all that data, we work with the content providers, then we bring in an advertiser... and they help offset, as well as kind of increase the investment around that content. So BetMGM is a good example. You wanna, we rolled out... Well, the original we rolled out was called Three Pointers, which was around March Madness, in which we created a show in which gave you the opportunity to learn how to, you know, create great appetizers, great drinks, games for the March Madness experience. We rolled something out with BetMGM, around football as well, around tailgating and things of that sort. And we've continued to roll out new, branded content studio projects. Gotcha. Maybe I'll just pause for a minute. Are there any questions for Mike? Yeah, sure. I have one. It seemed like Q2, there was a nice platform for gross margin. Kind of, talk to like what was kind of driving that. Yeah, I think from a gross margin perspective, when you look at, I think we've shared this before. When you look at the different types of revenue streams we have, we have, we break it out, kind of, advertising and non-advertising. So advertising is video and home screen. Home screen has the largest gross margin. It's pretty much 100% gross margin to us, near 100%. And when you look at Q2, I think we've done a very good job, not only driving home screen for media and entertainment, but also increasing the number of what we call sponsorships. So bringing in, you know, non-endemic or general market partners to come in and sponsor, whether that be a content hub, right? Like McDonald's for football viewing, I think we're rolling out some new content around Modern Luxury. And bringing in sponsors to come and be able to get their logo and their branding on our home screen. It gives them a good opportunity to kind of extend and grow more reach within the television marketplace. So as we build those, it continues to add more revenue into the home screen, which is our best margin business. Mike, we're about 10 months removed since the introduction of the Netflix AVOD service. You know, Disney+ obviously was close on their heels. Like, you know, very significant changes in the streaming landscape- Yeah With these two kind of industry titans getting into ads. Just what- how is the, you know, in your view, you see a lot, like, what is gone to expectation or maybe surprised you, in this, you know, coming up on the first year since the introduction? Yeah, I think it's kind of gone as expected. I think they've invested, but I think they're still more focused on growing the subscriber side of their business. I think from our perspective, it's good for us. I've said it in the past, I think anything that helps grow connected TV or the streaming environment is really good for us, right? Like I said, we're the distribution platform first and foremost. People got to come through our home screen. But I also think it's good for the advertising marketplace. I think one of the kind of accelerators, and I've said this in the past, between more dollars shifting out of linear into connected TV, is continuing to have more options with more scale. I think as Netflix, as Disney+ continue to grow more scale, I think you'll see more and more dollars shift out of linear into Connected TV and we'll be a very large beneficiary of that shift. Got it. As you think about the drivers of growth in the ads business, in your ads business within, you know, Platform+, you know, what are like the tangible drivers that you see? I mean, you know, clearly, you're growing users and, you know- Yeah Total viewers year over year. Is that the primary driver as you see it? Or is there kind of a total impression and pricing dynamic that is favorable as well? Yeah, engagement's the most important thing for us, so driving more engagement within the platform. I think in Q2, we were up 16% year-over-year in terms of time spent within SmartCast. That's gonna be the number one growth driver. The second growth driver is time spent within the most monetizable places for us. So not only getting people in and spending a lot of time within our platform, but also getting them into environments like our WatchFree+. And WatchFree+, our owned and operated app that we have on the platform, provides a cable-like experience to our consumers, continues to grow. We've continued to invest in it. It's continued to scale, and today, as it's been for a few months, is the number two ad-supported platform, ad-supported app on our platform, right? We're continuing to see success and growth in that app. Okay. Maybe, you know, just as we're in the second half of the year, we're heading towards the holiday season. What are you, you know, kind of super focused on in terms of, you know, your CRO function into year-end and, maybe, you know, looking ahead at 2024? Probably, you know, too early for guidance, but, like, what. You know, big picture- Yeah What are you, what are you really focused on for the next 12-18 months? Yeah. I think our largest growth will continue to be on the advertising side of the business. And within that, I think from a home screen perspective or display perspective, we're focused on driving more sponsorships, so broadening the advertiser base that comes on and engages with our home screen. Video will be the biggest growth trajectory we have, so we're continuing to obviously push out the new video products, layer on targeting. We just did a partnership with Intuit to bring QuickBooks data in that can marry with our own data to try to identify and grow the advertiser base there. And so for us, you know, we gotta continue to grow the video, 'cause that will help continue to accelerate the ARPU. We got a long way to go still in terms of ARPU run rate. We're just, as I believe, still kind of scratching the surface, even at $30. I think we're about at time. Yeah? Mike O'Donnell, thank you, sir. All right. Thanks. Coming to Nashville.