Don Patrick: Hi, Bill, thanks for the question. We believe there’s $150 million of incremental revenue available to us in those three businesses over the next 2 years, the calendar year ’24 and calendar year ’25.
Bill Dezellem: And that would be the market and then you would have your market share on top of that, you’re not forecasting to garner an additional $150 million in that for yourself?
Don Patrick: Yes. I’m sorry. I’m not sure I understand your question. We believe that we’ll be able to capture another $150 million of revenue across those three businesses for over the next – at the end of 2 years from now. It’ll be incremental to what we have today.
Bill Dezellem: All right. My sincere apologies. So that is specific to the Fluent potential?
Don Patrick: Yes.
Bill Dezellem: And so that would be on top of, let’s say, $80 million a quarter of revenues and additional $35 million or so of revenue per quarter?
Don Patrick: That’s right. The way you’re looking at it, yes.
Bill Dezellem: Okay. Great. That is helpful. And then with those buckets of business, what’s the margin potential that you see relative to Fluent historical margins?
Don Patrick: Yes. Great question. At scale, these will be – they will have larger margins, gross profit margins than what our traditional business has. Obviously, in the earlier stages, as we grow it, they have less but as we get to scale, they have – they run at a gross profit margins that are higher than the traditional core of Fluent.
Bill Dezellem: And $150 million, that would be at scale. At the very beginning, you would not be. How much revenue brings you to a level of scale where you see your margins being above?
Don Patrick: Around that level, Bill, the three opportunities that we outlined there has significant growth opportunities to us. And we are looking to scale those aggressively to take market share. So in that environment where we’re looking aggressively to go market share, we are going to be obviously spending a little bit more heavily. When we get to that $150 million of incremental, we’ll start, we believe we’ll hit above the margins that we currently have for our business.
Bill Dezellem: All right. And then once those businesses are mature, what – how much higher margin do you anticipate relative to the current business?
Don Patrick: Yes. Our current – as you guys know, our current – or as you know too well, Bill, our media margin, which is our core metric in our core business, tends to fluctuate between 28% and sort of 32% depending on traffic and depending on where we are in different investment scenarios, we see those 3 businesses being at the 35 to the high 30s as a percentage.
Bill Dezellem: Congratulations, and good luck putting all that together. And then relative to seasonality of the existing business. The call center business is stronger in the second half. Does that strength begin into Q3? Or is that primarily a Q4 phenomenon?
Don Patrick: Yes, it tends to hit very early in Q4 for the Call Solutions business, mostly around the health verticals, ACA and Medicare and things like that.
Bill Dezellem: Excellent. And would you like to give some commentary about how you see the third quarter revenue playing out given that we’re halfway through the quarter, and you’ve kind of highlighted that you see opportunity and challenges with the FTC settlement?
Don Patrick: Yes. The way we’ve outlined it, Bill, in the earnings is I think the clarity that we currently have now, we believe that we will be sequentially down in Q3 based on those headwinds and we look to good get back to growth in the early – we think it’s going to take a couple of quarters to work through the FTC headwinds and then we’ll see the growth returning as the FTC advantage that we have starts to kick in and also as these three growth – significant growth opportunities start to scale in 2024.
