If you go back in time and look at the company’s historical financials, you’ve seen that’s always the case. We always have elevated non-subscription sales within our direct-to-consumer channel during that peak holiday period. And so our revenue will step down in Q1 versus Q4 based on that seasonality.
Bill Chappell: Got it. So – but – all right, well, I’ll leave it at that. And then the second, just on Walmart. Certainly impressive of kind of the early start, but trying to understand where kind of the 3.8% market share was versus your expectations? Do you think you can get 5 or 6? I mean, obviously, 3.8% being at number four implies that number one and number two have a large, large, large share of the market. So just trying to understand where you think this can go over this year? Thanks.
Evan Hefer: Toby?
Toby Johnson: Yes. We’re incredibly grateful for the collaboration that we’ve had with Walmart, and we are very pleased with the initial six months that we’ve had with them. We do believe that there is momentum and opportunity to continue to grow. If you look at their coffee business, we’re playing currently with the launch that we’ve had in about half of the products, about 50% of the product lines in coffee. So that 3.8% of such a large business, they are about a third of overall FDNs, $11 billion business. Those are big numbers when you’re talking about a retailer that’s that large. So we’re very pleased. I think one of the things we’re most proud of that were mentioned in the earlier remarks is the incrementality that we’re bringing to the category.
So according to numerator data, about 35% of households were new to the copy aisle. Not all were new to Walmart, but they had not purchased coffee at Walmart in the 26 weeks leading up to our launch. We are really excited about that. And when you couple it with how our products are resonating, the 12-ounce bag size being the number one branded player with 22% of the share shows that we’re resonating with customers and with shoppers. That makes us feel really good about this initial launch. We are certainly staying humble and staying hungry looking for areas to improve and continue to build on the relationship. But our initial results, we are extremely proud of them.
Bill Chappell: Okay. So just to clarify, like, do you think you can get mid-single digit share this year, double-digit, 22%. Where do you – where should we be moving higher sequentially?
Toby Johnson: We would certainly want to build on our share. I don’t know that we’re publishing our – with a business that’s growing this fast, it’s difficult to give you the level of precision. I think you would hope for on exact share target, but we do see opportunities to continue to build. For example, just increasing consumption by driving awareness, as we layer marketing campaigns to ensure that people are aware that we sell our products at Walmart. That should drive consumption. We have other things that we’re working on as well that we think will add to the business. Certainly, we are not resting on our laurels, but we’re not – I don’t think we’ve published an exact share target. I would say it’s north of 3.8.
Tom Davin: Yes, it’s really a combination of marketing activities and innovation. So a lot to come on that.
Bill Chappell: Thanks.
Operator: Our next question comes from the line of Joe Altobello with Raymond James. Please proceed with your question.
Joe Altobello: Thanks. Hey, guys, good afternoon. Just want to go back to the guide for ’23 on the top line and particularly RTD, I think you mentioned it’s really not demand related, but more timing related with respect to the spring resets. I’m just unclear why that is because don’t the resets happen every time or at the same time every year. So why would that be a surprise, I guess.
