George Chamoun: Yes. And just when you look at some of these external things, let’s say, about conversion rates going up versus us saying we think it will be your typical seasonal pattern. A lot of that data you’re seeing was from, let’s say, the last x weeks. We have to — obviously have a tough job of saying, what could happen tee now and the end of the year. So just to separate those two things. That’s why it’s always just prudent for us to say follow seasonal patterns. It’s the prudent way to go. .
Operator: Our next question comes from the line of Rajat Gupta with JPMorgan.
Rajat Gupta: Thanks for taking the questions. Just a couple of quick ones; on green — customer assurance, the gross margins move lower sequentially. Was there anything to flag over there? Was it like pick up an arbitration cost? And then you talked about the year-over-year improvements just in terms of the inspection party. We just curious like was there anything to flag in the second quarter, specifically the margin there came a little lower than what we had expected. And then a follow-up it was really nice to see OpEx actually move down sequentially in a seasonally better quarter. But the guidance continues to call for a pickup in the second half versus the first half, in a seasonally light second half. So curious about what’s going on there? Or you just preparing for next year? Any other color you could add. Thanks.
Bill Zerella: Hey Rajat. Okay. I’m trying to keep track of all the different parts of your question. So let me — so the first one was on margins for customer assurance. So if you remember in Q1, we talked about the great performance we had on the arbitration front, which drove, overall, our blended gross margins at 50% in Q1, obviously, right? And we did say that we expected that Q2, our costs would go up sequentially quarter-on-quarter. That’s what drove the reduction in margin. And again, I think we’ve taken you through how the accounting works for that, right? In terms of if you kind of look at the trailing 12-month average and then depending upon what your actual is in that quarter, it moves the actual margins, reported either up or down.
. So frankly, that was not a surprise to us at all. In fact, at the end of the day, our overall revenue margin was 49%, which was actually a little better than we modeled internally. And obviously, with the OpEx efficiencies that you mentioned, we had a really strong bottom line performance with EBITDA loss of $4 million. So I know the third question was on OpEx. So let me just answer that one, and then I’ll go to remind me what your second question was. But in terms of OpEx for the second half, so part of this, a is actually the timing of spend. So we can’t be exact every quarter in terms of what the linearity is of our OPEX so what you’re seeing is baked into our guidance, a slightly higher OpEx spend in the second half versus the first half.
Obviously, we’ll try to beat those numbers. But overall, obviously, we’re lowering our projected EBITDA losses for the full year based on our new guide, right? Now you’re — remind me what your second question was?
Rajat Gupta: Yes, it was more on OpEx line, how was it down sequentially despite in a seasonally better quarter sequentially. So I was just curious like what drove the sequential reduction there. .
Bill Zerella: Yes, good question. So actually, our single largest expense on the marketing side is the NADA trade show. which happens in Q1, and that’s a 7-figure cost for us. So that obviously only occurs and hits our Q2 financials. So that is the primary driver in terms of the quarter-on-quarter decline. .
