Good day, ladies and gentlemen, and welcome to Ziff Davis third quarter 2021 earnings call. My name is Paul and I will be the operator assisting you today. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. On this call will be Vivek Shah, CEO of Ziff Davis, Steve Dunn, Chief Accounting Officer, and Alan Steier, Vice President of Corporate Finance at Ziff Davis. I will now turn the call over to Steve Dunn, Chief Accounting Officer at Ziff Davis. Thank you. You may begin. Thank you. Good morning, ladies and gentlemen, and welcome to the Ziff Davis Investor Conference call for Q3 2021. As the operator mentioned, I am Steve Dunn, Chief Accounting Officer of Ziff Davis, and I am joined by our CEO, Vivek Shah, and our VP of Corporate Finance, Alan Steier. The presentation is available for today's call. A copy of this presentation is available at our website. When you launch the webcast, there is a button on the viewer on the right-hand side which will allow you to expand the slides. If you have not received a copy of the press release, you may access it through our corporate website at www.ziffdavis.com. In addition, you will be able to access the webcast from this site. After completing the formal presentation, we'll be conducting a Q&A session. The operator will instruct you at that time regarding the procedures for asking a question. In addition, you may email questions to investor@ziffdavis.com. Before we begin our prepared remarks, allow me to read this safe harbor language. As you know, this call and the webcast will include forward-looking statements. Such statements may involve risks and uncertainties that would cause actual results to differ materially from the anticipated results. Some of those risks and uncertainties include, but are not limited to, the risk factors that we have disclosed in our SEC filings, including our 10-K filings, recent 10-Q filings, various proxy statements, and 8-K filings, as well as additional risk factors that we have included as part of the slideshow for the webcast. We refer you to discussions in those documents regarding safe harbor language, as well as forward-looking statements. Now, let me turn the call over to Vivek for his remarks. Thank you, Steve, and good morning, everyone. I'm pleased to welcome you to our first earnings call since the successful completion of our spin-off of Consensus and the renaming of our company to Ziff Davis, which reflects our position as a leading vertically focused digital media and internet company. The team at Consensus are off to a tremendous start and we wish them continued success. While Steve will provide an overview of our financial results, including and excluding Consensus, I'm gonna focus my comments on the pro forma results that exclude Consensus and divestitures, including the B2B Backup business that we sold in September. On that basis, we grew revenues by over 35% and adjusted EBITDA by over 23%, continuing a string of outstanding quarters. We're also reaffirming the guidance we provided about 2 months ago at the Ziff Davis Analyst Day. I also want to recommend for those who have not yet done so to watch the Analyst Day presentation videos, which are posted on ziffdavis.com. They're very helpful in understanding the company, our strategy, and priorities. Advertising revenues in the quarter grew by over 44%. We saw strong growth in every one of our verticals, which stands in contrast with some of our digital media peers. Health advertising grew by over 18% as we continue to see traditional pharma advertising dollars flowing into digital platforms. As we've noted in the past, we have significant reach with respect to both patients and providers, which makes us strategically valuable to pharma, and other health and wellness marketers. Gaming and entertainment advertising continued its strong growth and momentum as part of the new console cycle. While streaming platforms continue to invest for subscriber growth and theatrical starts its slow rebound. In our tech vertical, we saw 49% growth in our enterprise and B2B business as tech vendors grew their lead gen, and account-based marketing spend with us. Retail grew over 100%, aided mostly by the contribution of RetailMeNot, which we had not yet acquired at this time last year. Over the past couple of weeks, there's been a lot of discussion about the impact of iOS 14 and low opt-in rates for IDFA. As I've said in the past, we generate a lion's share of our ad revenue from contextually targeted placements as well as leveraging our first-party data. In addition, a vast majority of our advertising is browser-based, not mobile app-based, which is another layer of protection from iOS changes. Therefore, we believe that the headwinds associated with iOS 14 and the broader movement to limit ad tracking and targeting based on behaviors don't apply to us. I'd go further and say that an attractive aspect of our advertising franchise is that we have endemic advertisers who value the editorial environments and qualified clicks, and leads we're able to deliver. Nonetheless, in the short term, we'll closely watch for any shifts in advertiser confidence, but feel that we're in a very strong position over the long term with ad products, and solutions that don't rely on ad tracking. I will say that this has been a long-term strategic choice to develop business and monetization models that don't rely on third-party cookies and trackers. We're also closely watching for possible cascading effects from supply chain disruptions. We certainly saw in Q2 2020 how limited product supply led to marketers asking us to reduce the demand we were generating for them. I know many of our retail partners are looking to stimulate online purchasing much earlier this year to give themselves more time to meet demand. We've responded by organizing our programming and efforts to start earlier too. Obviously, we will be closely watching for any headwinds associated with supply chain challenges. Subscription revenues in the quarter were up over 18% compared to Q3 2020. Our connectivity subscription businesses, which includes Ookla and Ekahau, grew by 34% in the quarter as the demand for broadband network intelligence and Wi-Fi planning and deployment continues to strengthen. We also acquired a small but strategic asset in the quarter called Solutelia, which we believe extends Ookla's depth of network measurement capabilities while also broadening our competencies in network building and site assessment. The cybersecurity and MarTech businesses grew nearly 20% in the quarter, driven by the acquisition of Moz, which is proving to be a strong addition to our MarTech portfolio. At the beginning of 2021, we began investing to establish sustained organic growth at these businesses, which have historically maintained conservative levels of sales and marketing. The competition for subscribers is fierce, and it will take time to scale customer acquisition programs that fit our profitability goals and to see the impact of our investments on recurring revenue. We're committed, however, to finding a path to balanced total growth while still delivering market-leading margins, as we believe cybersecurity, and MarTech represent two of the most valuable segments in the market today. Our adjusted EBITDA grew by over 23%, with margins close to 34%, down about 300 basis points versus last year. A good chunk of the increased expenses are subscriber acquisition expenses in cybersecurity and MarTech, with the balance coming from lower margins at newly acquired businesses and the return of expenses that were light during quarantine. We should see margins improve to roughly 40% in Q4 and bring the full year margins to over 35%, which is our target for the company now and going forward. As I indicated earlier, we are reaffirming our full-year guidance, which I should remind you, contemplates an expected deceleration in revenue growth to about 10% in Q4 for three reasons. Number one, the year-over-year benefit from the RetailMeNot acquisition is mostly gone, given the acquisition took place in November 2020. Two, a difficult year-over-year Q4 comparison. Last year's holiday season disproportionately favored online sales, and many advertising programs paused in Q2 at the outset of the pandemic came back in Q4. Three, we saw a one-time benefit from the introduction of the new gaming consoles. At the midpoint of our range, our full-year guidance represents revenue and adjusted EBITDA growth of roughly 26%. A key contributor to our growth has been and will continue to be our acquisition system. With our focus on executing the spin, we've been somewhat quiet on the buy side for the last year. Steve will walk you through this, but on a pro forma basis, we have $726 million in cash, $368 million of investments, and gross debt of $1.217 billion, which represents a gross debt to EBITDA ratio of 2.5 at the midpoint of our 2021 guidance. In other words, we're well capitalized and have a very healthy balance sheet. We will continue to be patient and disciplined in our deployment of our capital and believe there are a number of attractive Digital Media and internet assets for us to consider. Just a quick update on our CFO search. Because of the great finance team we have, including Steve and Alan, who are with me today, I've had the opportunity to be deliberate and thorough in the search. We're seeing some fantastic candidates, and I believe it's realistic to expect a new CFO in place by our next earnings call. In the meantime, we shouldn't miss a beat as we have a deep and talented operational finance team in place. Before I hand the call back to Steve, let me provide you with an update on our ESG efforts. We are in the midst of our first greenhouse gas audit, where we're calculating our carbon emissions for 2019, 2020, and 2021. We expect to complete the audit by early January, and plan to communicate our findings in our 2021 ESG report, which will be published in Q1. As you may know, measuring GHG emissions is the key element for sustainability reporting, and this audit will enable us to set science-based targets and net zero goals for the company next year. In addition to our environmental efforts, we're also heavily focused on the S or social in ESG, especially as it pertains to DEI. Since our last earnings call, we released our 2021 diversity report, which highlights key data around our workforce representation, hiring and inclusivity, senior leadership and management, promotions, and employee resource groups, among other topics. The diversity report is both comprehensive and informative and can be found on ziffdavis.com. I'm very pleased with the ESG strides we've made this year, and I'm confident that we'll continue to build upon our efforts, and the foundation that we've created. With that, let me hand the call back to Steve. Thanks, Vivek. I'll be walking you through our consolidated non-GAAP results for Q3 2021. As you recall from our previous earnings calls, we sold our ANZ Voice assets in August 2020 and our UK Voice assets in February 2021. In September 2021, we completed the sale of our B2B Backup assets. As a result, we will present our full non-GAAP results, which include these operations for the periods owned, and when we refer to our pro forma results, it will exclude the contribution from these divested assets. Separately, we will also address Ziff Davis performance, excluding the Consensus business and the divested Voice and backup assets. Now let's review the summary quarterly financial results on slide four. Let's begin with our revenues inclusive of the Consensus business. It was a record third fiscal quarter of revenues for the company. We reported revenue of $443 million in the quarter and $434.7 million of revenue, excluding the divested Voice and backup assets, representing approximately 24.5% and 27.7% growth, respectively, from Q3 2020. Adjusted EBITDA was also a record for a third fiscal quarter, with $175.1 million as reported and $170.8 million excluding the divested Voice and backup assets, resulting in year-over-year growth of 13.6% and 16%, respectively. Finally, growth in our earnings per share. In the third quarter, we had $2.34 of reported non-GAAP adjusted EPS and $2.27 of EPS excluding the divested Voice and backup assets, a growth of 15.8% and 16.4%, respectively, from Q3 2020. Turning to slide five. In Q3, we had strong free cash flow, generating $110.5 million, which represents a nearly 18% increase over the $93.7 million generated in Q3 of 2020. Over the last 12 months, we have generated in excess of $446 million in free cash flow. All of the figures on this slide are inclusive of Consensus and the divested assets. Now let's turn to the two businesses, Cloud Services and Digital Media for Q3, as outlined on slide six. The Cloud Services business, inclusive of Consensus, grew 7% on a reported non-GAAP basis to $182.1 million and 12.3% to $172.5 million, excluding the divested Voice and backup assets. Adjusted EBITDA was $83.7 million as reported and $79.5 million excluding the divested Voice and Backup assets, generating growth rates of -4.7% and -1.7% respectively. As Vivek mentioned, the slight decline relates to marketing investments and acquisitions with margins that are not yet optimized. The Digital Media business revenue grew 40.4% to $262.2 million and experienced double-digit revenue growth exclusive of RetailMeNot, which was acquired in Q4 of 2020. The segment saw its total adjusted EBITDA increase 37.5% to $103.1 million. On slide seven, we show the third quarter results for Ziff Davis, excluding Consensus and the divested Voice and Backup assets. Our organic revenue growth was 12% and our total growth was 35%. On the $346 million of total Q3 revenues, we had $117 million of EBITDA, representing growth of 23%. On slide eight, we have provided quarterly Ziff Davis financials excluding Consensus and the divested Voice and backup assets. We've also provided a disaggregation of revenue by our three types: advertising, subscription, and other. 57% of our Q3 revenues came from advertising, and 30% were derived from subscription and licensing revenue. The remaining 4% is in other. Moving to slide nine, we wanted to provide an overview of our cash, investment, and debt positions, particularly as the Consensus spin occurred in early October after our fiscal quarter end had already ended. For the avoidance of doubt, this table only accounts for known adjustments and does not include any impact from cash inflows or outflows since the end of Q3. Vivek noted earlier in our pro forma cash of $726 million and gross debt of $1.217 billion. Let me walk you through the numbers. We ended Q3 with $546 million of cash, $111 million of long-term investments, which were OCV and Welltok, and $1.785 billion of gross debt. Please note those debt figures are principal debt. The spin-off distributed $771 million of proceeds. We tendered for $83 million of principal of our high yield notes and repaid our bridge loan of $485 million. The debt premium for those transactions was $22 million. This results in a pro forma increase in our cash of $180 million. In addition, the CCSI stake on the day of the spin was worth approximately $257 million. Total pro forma cash and investments are $1.094 billion, and gross debt is $1.217 billion. Finally, before going to our question, and answer session, I would like to turn your attention to our business outlook on slide 11. We are reaffirming the full-year 2021 Ziff Davis RemainCo pro forma guidance given at our Analyst Day on September 9, and have also provided fourth quarter guidance of revenues between $400 million and $414 million, EBITDA between $154 million and $162 million, and non-GAAP adjusted EPS between $2 and $2.14 per share. We are estimating an effective tax rate between 24% and 25% for Ziff Davis in Q4 and going forward, barring any legislative changes. This is higher than historic rates due to the business now having a higher proportion of its income in the United States. We're also assuming a share count of approximately 48.6 million. Following our business outlook slide are various metrics and reconciliation statements for the various non-GAAP measures to their nearest GAAP equivalent. I would now ask the operator to rejoin us to instruct you on how to queue for questions. Thank you. Thank you. We will now be conducting a question and answer session. In the interest of time, we ask that you please limit yourself to one question. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove yourself from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment please while we begin. The first question is coming from Cory Carpenter from JP Morgan. Corey, your line is live. Good morning. Thanks for the question. Apologies, I'm losing my voice. Vivek on the ad environment, been on a lot of calls the last few weeks, and it feel, you know, you sounded, you know, quite positive, certainly more so than the message we've heard from some other companies. Just hoping you could talk more broadly. It sounds like you're not really seeing any impact. Well, certainly not seeing any impact from iOS, but also not from the macro and supply chain. You know, is that right? Maybe if you could just speak to kind of what your expectations are for the fourth quarter, especially given your e-commerce and gaming vertical exposure. Thank you. Sure thing. Good morning, Corey. So yeah, look, I think that from an advertising point of view, we had a really fantastic Q3. You know, I would say that so the principles of our business being vertically driven, being performance driven, and being contextually driven really has been a clear advantage for us. A lot of what's happening, as you know, in the ad environment has to do with sort of the ongoing and systematic disabling of the interest-based ad targeting framework and construct. What I mean by that is over the last decade, advertising went from something that was targeted to a very specific audience in a very context-specific moment to sort of a separation of the impression and data, and using data harvested in other activities, other things you did, other ways in which you created sort of a digital footprint and applying that to inventory. What you're seeing being done from a regulatory point of view, but more from a self-regulatory point of view, where you have platforms, large platforms, as well as browser companies that are doing various things that are making that more challenging. That's not our business. As I said in the prepared remarks, we've been organized around this reality for a really long time, understanding that ultimately the contextual advertising would, you know, the value of it and the marketplace embrace of it would swing back as the interest-based advertising gets undermined. Now, having said all of that, the thing that I'm absolutely careful about is that when you have these kinds of headwinds in large parts of the ad ecosystem, we wanna watch to make sure we don't somehow fall into a receding tide of any form. We're not seeing it, but it is obviously something we're watching. On the supply chain side, as I said in the remarks, look, we did see how that does directly translate into advertising pressure, and that was Q2 of 2020. That was when we ran into a situation where a number of our retail partners, and as you know, retail is a huge ad category for us. A number of our retail partners said, "Look, I don't have supply. I don't wanna buy your demand. I don't want your demand. You gotta turn off your demand." We're a demand generator. If you're to see a replay of that would certainly have some type of near-term effect. I think it's a little early to really answer that question as to whether or not we're gonna see that play out in the holiday season. As you know, and as I pointed out, we are seeing a number of marketers saying, "Hey, I've got supply right now. Let's try to get people to do their holiday shopping right now." Today is cashback day at RetailMeNot. If you're looking for our savings, I'd encourage you to sign up. We are doing things a little bit earlier this year in anticipation of what may be, you know, an inventory problem as you get closer to the holidays. Great. Thank you. Very, very helpful. Thank you. The next question is coming from Shyam Patil from SIG. Shyam, your line is live. Hey, guys. Congrats on the quarter and the successful spin. Had a couple of quick ones. Vivek, can you talk a little bit about, now with the spin, how you're thinking about new vertical expansion versus kinda building out existing verticals? Just what, you know, what the priority would be or urgency or likelihood would be of new vertical expansion. On IDFA, you know, you guys have a pretty strong gaming franchise. Do you think that you could potentially benefit from IDFA since gaming advertisers, you know, now have fewer alternatives than before in terms of where they can acquire customers? Thank you. Thanks, Shyam. I'll take the first question. In terms of vertical expansion, you know, look, we always are looking at adding to our lineup of verticals, but when you consider the verticals we're in, tech, shopping, entertainment, health, cybersecurity, and MarTech, these are some pretty big verticals with big TAMs, lots of great growth characteristics, and we're still. We've got a lot of room to grow in penetrating those. If you were to ask me if I had a preference or if I had a bias, I'd probably have a bias to deeper expansion in the existing verticals. We've got platforms, successful businesses, great teams in place, and it allows for all sorts of sized acquisitions, including tuck-in acquisitions, which often are the most accretive acquisitions that we can do. I would say that there is a slight bias towards deepening the existing verticals. Having said that, you know, look, we're always open-minded, and I will say that the pipeline right now is pretty strong. You know, our balance sheet reload has received a fair amount of attention, and so we're seeing a lot of things that maybe in the past we might not have seen, though we generally saw quite a bit. There's a lot of inbound coming in and certainly if it represents a new vertical with the same kind of digital transformation opportunities we like, the same kind of ad and subscription based models that we like, and the same sort of opportunity to uniquely create value, right, in leveraging our platforms, which is key to our M&A strategy, then certainly we would go, you know, we would go that way. In terms of the question, and I'll take it even more broadly because there's IDFA, which is the here, and now. There's the deprecation of the third-party cookie. I would put that all under the larger umbrella of trying to really end third-party data tracking and utilization for the targeting of advertising. I think that's a long-term trend, and I do think that it will then ultimately, in the long term, favor those who do the inverse of that, and that would be us. When that happens, I don't know. I will also say that, you know, the industry is innovative. While the mechanisms that may be used today to establish profiles that are used for targeting may be, you know, may be challenged, the industry always comes up with new ways. I suspect that, you know, a lot of the folks who are on the interest-based advertising side are not gonna lay down, and just, you know, not respond to it. I suspect you'll see some sort of, response. I think in the end, I think what's gonna really matter are platforms that have real registered users who have volunteered information and provided that information that can be used to create the most relevant advertising messaging. I think you're gonna see if a platform can have a true direct relationship with their user base, I think that will be to some advantage. Great. Thank you, Vivek. Thank you. Thank you. The next question is coming from Rishi Jaluria. Rishi, your line is live. All right. Wonderful. Thanks so much for taking my questions and nice to see continued strength in the business organically. I wanted to get a sense with you know maybe if you could talk a little bit more about the cloud businesses and maybe give us a little bit more color on how they're kind of doing and what the outlook for those going forward is and particularly interested in you know the MarTech space as well as you know what you're seeing on the VPN side of the equation. Thanks. Yeah. Good morning, Rishi. Thank you. Look, I think that, let me describe what you know, the division formerly known as Cloud Services is today. It is our cybersecurity, which goes to market as the VIPRE Group and our MarTech group, which goes to market as the Moz Group. I mention those brands because they're really great brands. You know, Viper represents a very strong cybersecurity and well-respected cybersecurity brand. Underneath the VIPRE Group are component brands, including IPVanish, which is the VPN business. Then the Moz Group. You know, Moz is a reasonably recent acquisition, consists of not just Moz, which is the leader in SEO analytics and software, but also iContact and Campaigner and our email marketing services. Both groups right now, we feel very good about the portfolio and the brands and the capabilities inside of each group. As you know, particularly on the cybersecurity side, with the disposition of the B2B Backup business, that was part of making sure that the go-forward portfolio or the businesses that we felt had the most amount of potential, and promise, and could work together. I would characterize these businesses as still going through a transition. They historically were managed, not unlike a lot of the other Cloud Services businesses, entirely for profitability and very little focus on organic growth, and certainly not enough investment in sales, marketing, and product to generate the kind of organic growth that others in the market are seeing. Now, those others in the market don't support the same profitability. We have a strategic question that we have answered for ourselves that show up in our financials, which explain you know the margin differences. We are investing and have been for the last several quarters, and will continue to identify ways to put money to work, expenses to work to generate organic growth. It is early in the process. As you know, it takes time to build up subscription revenues, but we're committed to it. Because look, what I would say is both of those verticals are white hot. Both of those verticals, we have great assets. We have enviable scale in these verticals and enviable margins. What we don't have is a real organic growth story. The growth story has been largely M&A, and that's the aspect, like we've done in other parts of the company, that we would like to see change, and we are willing to invest because ultimately, when we get that equation right, I think the valuation of those businesses will be quite significant. If you watch what's happening in cybersecurity, watch what's happening in MarTech, you know, you see revenue multiples that look like our EBITDA multiples. So, you know, there's an aspect for us which says we can participate in that, and so we're very focused on that. I will tell you, it absolutely reminds me of the same observation we had in 2018 on the Consensus business, where we sat there and said, "Wait a minute. There's real growth opportunities in here. We need to invest." We did to unlock those growth opportunities, and today, obviously, Consensus is on its own as a successful public company. There's a lot of lessons from that experience that we've learned and that we think we can apply to both the cybersecurity and MarTech businesses. All right. Wonderful. Thank you. Thank you. Thank you. The next question is coming from James Fish from Piper Sandler. James, your line is live. Hey, guys. This is Quentin on for Jim. Thanks for taking our questions. First, you know, a really strong quarter of monetization and take rates in the Digital Media business. How much of this is RetailMeNot driven versus core driven? Maybe more housekeeping. Any idea of the breakdown of advertising versus subscription and the performance versus display in the quarter? Thank you. Yeah, sure thing. What I'll do is, just 'cause I wanna get my colleagues in here, I'll take the first part of the question, and Alan, maybe you can take the second part of the question. You know, with respect to the advertising outperformance, obviously the contribution of RetailMeNot in the third quarter as compared to last year's third quarter was meaningful, as it wasn't in last year's third quarter. But even adjusting for that, I believe the growth was close to 20%. Alan can correct me if I'm wrong in terms of the existing assets. The growth rates were great. Now, I'm also gonna point out that Q3 for us last year was really good. You know, we had kind of gone into the quarter a little concerned about the comp. You know, we're happy. Then obviously, with all the ad environmental issues, you know, that we've talked about, we had some concerns at least going in of what this might mean and what would happen. We're super pleased with where we came out. Again, I just do think that the verticals are very strong that we're operating in. I should point out, because it is such an important driver and it's just been a consistent performer. Our health and wellness assets, Everyday Health Group, BabyCenter, What to Expect, MedPage, they've all done so exceedingly well. I just really proud of those colleagues 'cause they just keep putting up points. But Alan, on the splits. Yeah. RetailMeNot was. When you exclude RetailMeNot, we still grew in excess of 18%. Roughly around the 20% that you quoted, Vivek. In terms of the splits between display, performance, and subscription for Digital Media was roughly 41%, 34%, and 20% respectively. Steve mentioned in his prepared remarks that when you do the breakdown between advertising, subscription, and licenses and other, it was roughly 57%, 39%, which came from subscriptions, and then 4%, which is categorized as other. Super helpful. Thank you. Thank you. Thank you. Just a reminder, ladies and gentlemen, if you wish to join the Q&A queue, you can do so by pressing star one on your telephone keypad at any time. Once again, please press star one on your telephone keypad if you wish to enter the queue. The next question is coming from James Breen from William Blair. James, your line is live. Thanks for taking the questions. Just a couple. When you look at the pro forma numbers you gave for the standalone Ziff Davis now, and you look at sort of year-over-year growth and then growth in EBITDA versus growth in revenue, it seemed that, you know, EBITDA was sort of outpacing revenue growth through the first couple quarters of this year and then sort of reversed this quarter and will reverse next quarter based on the guidance. Can you talk about sort of what's happening there and what's causing that? Then just strategically, you know, looking at the balance sheet and what you're gonna have for cash pro forma and debt, you know, what are the thoughts on bringing gross debt down, holding cash for M&A, and any sort of color you can give us around, you know, on a projected, you know, $1.3+ billion revenue line, you know, what the free cash flow dynamics will look like, for the pro forma Ziff Davis business. Thanks. Thanks for the question, James. I'll do margins and balance sheet and maybe Steve, you can talk to the free cash flow. We'll get you in here too. With respect to margins on a year to date basis for the RemainCo, which is what I think you're asking about, we are ahead from a margin point of view. There's been a little bit of choppiness between Q1, Q2, Q3. Part of it has to do with the return of some expenses that were light during peak quarantine. Much of it has to do with investments we're making that I referenced in cybersecurity and MarTech around sales and marketing. Then some of it has to do with acquisitions like Moz that have come in, with revenue contribution, but not EBITDA contribution yet that we're optimizing as we often do for EBITDA contribution. I would say that, you know, nothing really surprising here, and obviously was built into our own expectations. Again, last year's, I think margin was a little bit artificially high because of spend levels being off. I think long term, I think the way to think about margin is in that 35%-36%. That seems to be the comfortable margin for the RemainCo, and by the way, historically consistent. When you thought about the whole co where margins were roughly 40%, that was. It was biased up by the Consensus business. Not a change. I think still a very healthy margin level balanced against our own growth expectations. On your question around sort of balance sheet and debt. Look, I think that right now we feel very comfortable with where we sit. We feel comfortable with the cash that sits on the balance sheet and leveraging that cash and deploying that cash for acquisitions to generate returns. I think that you know, the demand for that capital will be very strong. You know, from our point of view, it'll be best used through the acquisition program for the most part. I'll also point out we are reasonably well below sort of our policy around you know, maintaining a quote-unquote ceiling of 3x gross debt over EBITDA. We're well under that. We'll continue to be under that as we grow. Then, you know, one thing I'll just point out because I do get asked about this and so I answer this, which is what we're planning to do with the retained stake in Consensus, which is as Steve pointed out, at least that spin was worth $257 million. What I'll say is we haven't made any decisions yet, but remember that in order for it to be tax-free, we would need to execute a debt for equity exchange or an equity for equity exchange within a year. We can decide to hold the stake for up to five years, but at which point we would end up having to pay tax on the stake. You know, just wanted to lay that out. Steve, maybe just a little bit on free cash flow Ziff Davis, what we think a little bit maybe on the tax rate. Yeah, absolutely. Thanks, Vivek, and thanks for the question, James. Yeah, I think what you'll see with Ziff Davis going forward, you know, if you look at our revenue, we are, as Vivek previously mentioned, looking to continue towards a 60% EBITDA conversion rate on our revenue. Down a little bit from the mid-60s because of investments in the business and higher CapEx. Then, sorry, 40% EBITDA conversion on our revenue. Then from that, I believe we're gonna be at about 60% conversion of EBITDA free cash flow going forward. Like I mentioned, we will have some investment in the businesses. We're driving that organic growth and adding a little CapEx to achieve that. I think those are kind of the numbers directionally we're headed for in the future. Great. Just one housekeeping in the guidance for the fourth quarter for revenue, is there any fax revenue in that guidance? No. The one week- Okay. of Consensus is excluded from the business outlook. Vivek asked me to touch on the tax rate. Sorry, James. We're looking at 24%-25% as our effective tax rate. Slightly up from where we've been in the past with the spin-off. It's increasing our domestically sourced income at a higher tax bracket. Okay, thanks. Then just one last one just around the subscription-based revenue that you guys broke out. When you think about growth there, is there a way for that growth to come from existing customers, or is it all new sign-ups? I mean, it's a combination really. I think it depends on the service. In some instances, it's gonna be bigger share of wallet, where, you know, the subscription service is more of a SMB-type service, but then also penetration of more customers. In some cases, it could be price. We actually have been experimenting in cybersecurity of taking up price. It's cost us a little bit on cancel, but it seems to be driving better unit economics. I think it's. The answer is it depends 'cause there are a number of different subscription businesses in there, dissimilarly situated at times. I think in all cases, you know, I think we can get more subs, you know, in some cases higher price points, and then in some cases higher share of wallet. Great. Thanks. Thank you. Thank you. The next question is coming from Will Power from Baird. Will, your line is live. Hey, this is Charlie on behalf of Will. Thanks for taking our question. Just wanted to ask about the Q4 guidance, specifically the revenue. Is there anything to call out on sort of, you know, subscription versus advertising split maybe? Going forward into 2022, how should we kinda think about the organic growth profiles of, you know, both the subscription segment and the advertising segment? Yeah. No. It's a really good question. I want to point out that from a go-forward basis, we are actually thinking through what are the right segments for Ziff Davis, what are the right disaggregation of revenue. Probably advertising, subscription and other won't be segments 'cause you can't get down to you know to a bottom line on those. I think they are the most relevant ways to model and think about the company. We're trying to work through that a little bit. You know, in terms of the Q4 guide, you know, we obviously had a beat in Q3 and then are not taking up our guidance. That reflects, you know, a lot of the dynamics that are going on in the ad market and you know, any potential harmful effects around, you know, supply chain disruptions principally. I think we are appropriately keeping that guidance in place. I think those are some of the factors that we think about. We don't really. Yeah, obviously we don't typically quarterly guide, but it's the last quarter, and we certainly don't guide by revenue type. But I will say that the fourth quarter, as I think you know, and you can see this in our historical financials, you know, slide eight of the presentation, you see the Q4 advertising number typically is a very large number. Q4 Historically, in Q4 in 2021 will really be about the advertising business more than anything else. With respect to next year, you know, it's probably premature for me to give you an answer on that. We're working through our budget processes, looking through understanding where organic growth sits, where you know, where the acquisition pipeline sits. I just wanna point out too is that, you know, ultimately, again, you know, our definition of organic growth is an interesting one in that it's a very conservative one in that we exclude the asset for the first full year, and then we include it. The challenge with that is in the 13th or 14th month, when you are comparing to the first or second month, and we are doing a fair amount of restructuring and shrink to grow, that has a fairly dilutive effect on organic growth rates. You know, that's something to keep in mind as we think about that. What we typically do is we'll exclude in our own modeling those assets 'cause we know what that path is and then the organic growth on the assets that we've owned for a while. Working through that process, I think long term, as I've said, I expect the company to grow, you know, mid- to high-teens% total, half of that organic at a 35% margin. That is our target. That is what our long-range plans call for. You know, there are gonna be years where I suspect we do better, as we are this year, and there are gonna be years where we come a little bit under that, and I think that's fine. Okay, great. Thanks, Vivek. If I can just ask one more on maybe just M&A, kind of the philosophy around it. Is there any change relative to JCOM before the spin maybe like two years ago? Is there any change in terms of the frequency you guys plan on making acquisitions, the size? Since this past year, due to the spin, you haven't been as active as in the past. Is it possible there's maybe some catch-up M&A in this following year? Or how should we think about that? Yeah. No, it's a great question, you know, you're absolutely right. As much as we were attempting to stay very active in the M&A market during the Consensus spin, I gotta tell you that this was all hands on deck, you know, seven days a week, 24 hours a day. It's probably not said enough, but you know, we executed this spin really within five months from the announcement, which is probably some kind of record somewhere. That is a function of the hard work of our team and the focus and dedication. I do think that it took away from, you know, some of the activity on the M&A side. I do think, though, that we are gonna be careful and disciplined as we always are, you know, not be too, you know, feeling like we've starved ourselves and we're at the buffet. We don't wanna overeat. We're gonna be disciplined and thoughtful about it. As for the M&A mindset, strategy, approach, nothing's changed. You have to remember that while the company's separated, the M&A system for the last decade has been 95% the RemainCo. That won't change. Got it. Thanks very much. Thank you. Thank you. The next question is coming from Jonathan Tanwanteng from CJS Securities. John, your line is live. Hi, good morning, everyone. Thanks for taking my questions. You know, congrats on a successful spin out. A great quarter, and it really must feel good to be vindicated on you know, putting your eggs into the contextual basket as these things play out in the ad industry. Good work there. Thank you. A lot of my questions have been answered already. I was wondering, though, if within the MarTech business, does any of that actually rely on these tracking and cookies and things that, you know, aren't so popular these days? Or is it a completely different business than that? I'm wondering how you generate leads and, you know, extend your reach on those platforms. You know, it's actually, you know, in some ways it should be a beneficiary 'cause the two principal things that the MarTech business does are, one, help companies rank in search engines organically. Again, as you are looking for ways to generate traffic for yourself, ways to generate customers, you're gonna focus on SEO more than you might have in the past. Because if you can't get it out of the social platforms 'cause the targeting's perfect and the CPAs, you know, the cost per acquisitions are great, you're going SEO. I think that helps us from an SEO point of view. Then the other part of what we do within MarTech is email marketing. Help you build a list, help you generate and compose emails to send to that list, optimize delivery and open rate, track performance, and optimize performance. You're gonna do that too. In many ways, I actually think it's a great question, and it's something we've talked about internally, which is, will we start to see that paid media, which is interest-based, move to earned media, which is really what we're trying to do. When we're trying to get you SEO'd and get your email platforms going, we're trying to help you generate earned media. Outside of paying us for the platform, there really isn't a specific expense. You're not buying ad inventory. Hopefully it's actually a tailwind for us. Gotcha. That's helpful. Has there been any incidents or an anecdote of actual explicit benefits to you guys where the customer comes to you and said, "Hey, we're not getting the results we want in paid, you know, paid media, and we wanna come to you either contextually or through the MarTech and increase our budgets there just to get what we're looking for? You know, the honest answer is I don't know if that discussion has happened because I don't know if they would necessarily say it that way. I think it just shows up in, "Hey, I've got more budget. What can we do?" You know, it may well be they have more budget because of that dynamic. You know, often the buyers are, you know, keep close to the vest the dynamics that are going on. 'Cause remember, every ad contract is a negotiation. I suspect some of that has absolutely happened. Now, the key for us is can we deliver, right? We have the ability to take the incremental money and deliver unit economics that are consistent with what we've delivered them, and more importantly, as good if not better than what they may be switching from. Got it. One last one from me. I was wondering, you provided some good color on the risks of, I guess, inventory being short later this year, you know, just because supply chain inflationary issues. I was wondering if you had a view of how it might impact you internally, just labor inflation, as you go through the year, being able to retain people, and as we get into 2022, how that adds up with, you know, costs that may be coming back into the fold such as travel and such like that. No, listen, it's a great question, and obviously this is as tight a job market, and the competition for talent is frankly unlike anything I've ever seen. Given that many companies, certainly in our industry, are work from anywhere. You know, people have a lot more options in terms of where they can go. I think we've done a very good job from a retention point of view, and we've been very sort of focused on the employee experience, the onboarding experience. We've created all sorts of virtual programming to keep the employees engaged, and really our focus on profits and purpose, our focus on ESG, on social value creation for our workforce is a huge retention vehicle. I think we've done well with all of that. Are we going to pay more for talent? Probably. I think that is happening. I think you're seeing some inflation in terms of wages. We've seen it in some places. You know, look, I think it's manageable, and I think it's you know, probably an offset possibly to other expenses that maybe over time we can remove from our equation. You know, we're thinking through what our real estate footprint ultimately needs to be and what that looks like, and there may be some savings there that can essentially get redeployed into people's salaries. Got it. That's helpful. Thank you. Thank you. Thank you. There were no other questions in queue at this time. I would now like to hand the call back to Vivek Shah for any closing remarks. Great. Thank you very much, Paul. Listen, we appreciate you all joining us today for our Q3 earnings call. I'll be participating in an investor conference in the coming weeks, hope to see some of you there. Have a great day. Thank you. Thank you, ladies and gentlemen. This does conclude today's conference. You may disconnect at this time, and have a wonderful day. Thank you for your participation.