So on a blended basis, as Software grows margin expands, on the App side, reaching stability with potentially slightly lower margins. That’s how we end up at the mid-40%s margin target.
Ralph Schackart: Great. Maybe a question for Adam. Adam, can you maybe get some perspective, AXON 2, how it’s performing maybe relative to your expectations and any sense of order of magnitude of improvements compared to 1, obviously, very strong results in the quarter, but any more color there would be great? Thank you.
Adam Foroughi: Yeah. For sure. We — I’d say it’s performing at our expectations. We signaled it a year ago as something that was going to be a big upgrade, because we just knew that the technology is available to us were dramatically better than the technologies that we were using. We put it into power the entire platform in the quarter and it was immediate to start seeing much better performance for advertisers. What that does over time, is that all compound and advertisers will be willing to spend more on our platform, because they are seeing better return on ad spend on their buys on our platform than they were previously and that should start to grow over time, get more investment from the base of advertisers we have.
But even more exciting for us is, the implications that we are going to be able to make a wider breadth of advertisers work with this new technology. It’s much more predictive, much more powerful, and if we are able to execute on that, we can really broaden out the advertiser base, service new verticals and that should really fuel our growth for quarters and years to come.
Ralph Schackart: Thanks, Adam. Thanks, Herald.
Operator: Our next question will come from Franco Granda with D.A. Davidson.
Franco Granda: Hi. Good afternoon, guys. Thanks for taking the question here. I have two quick ones. So with the market stabilizing here, AXON 2.0 yielding such positive results so early on, are you ready to provide an updated figure on how many dollars you think it transact to your platform either this year or maybe next? And then for the second one, can you talk about maybe any trends across your Apps portfolio that surprised you in the quarter, perhaps, any category where you outperformed the respective market? Thanks.
Adam Foroughi: Yeah. In terms of the scale of the platform, we have never provided that, but the advertising business is on a net revenue basis and we have talked about typical advertising business margins that are known in the industry somewhere in the 20%s to 30% range. And so you could get to a reasonable guesstimate, the marketplace itself is in the billions of dollars, obviously, our Software Platform cleared $400 million and the vast majority of that being advertising networks net revenue in the quarter. So we are a very large player in the mobile app ecosystem. And if you just size that against the totality of the mobile app ecosystem understanding a lot of our partners are mobile gaming customers, we are a critical player for almost all of our customers.
They really depend on us for growth. So the thing that really gets us excited in our ecosystem is this upgrade in technology not only helps fuel our growth, our customers are spending a better dollar on our platform and we are usually one of their top one or two or three channels that they invest into. So if they are spending a better dollar on our platform, that will compound for them, too. And so as we go forward, we will start seeing the market of customers that are working with us growing, hopefully materially better than the market itself and return — helping to return this category as a whole back to grow.
