QuoteMedia, Inc. (PNK:QMCI) Q4 2022 Earnings Call Transcript

Unidentified Analyst: Okay. And I don’t mean just on critical. I am like a happy investor. So I’m not — I’m very happy with 2022 and everything. So it’s not — I’m just trying to understand certain things. And my last question is, if I look at your publicly traded competitors, the ones that are like much larger than you, their gross margins are typically higher and I’m wondering, is that because they’re charging more? Is that because they’re offering products that you aren’t offering? Or is that something that just comes with scale? Is that — are these margins you could see you approach as you scale up? I’m talking about gross margins? Or is it apples and oranges?

Keith Randall: I’d have to know exactly — sorry, go ahead, Dave.

Dave Shworan: Well, I was just going to say, I mean, obviously, with scale is better margins. I mean the more and more customers you’re serving off of the same data sets and the same servers and all of that, then definitely, that’s a factor. Are they charging more? That could be another factor. So I think you pointed out to, for sure, factors that like we’ve replaced a bunch of these large solutions where we’ve replaced quite a few different vendors in order to take over the market data for a firm. And we’ve actually tried to save them money. They’ve come to us for that reason that they know that they’re overspending. They’re on ancient contracts that are — have ballooned over time. And so maybe we are charging a little bit less but that’s what the clients are looking for in this day and age. You can go ahead, Keith.

Keith Randall: Okay. Yes. No, I would just add that we are expecting our gross margins to improve again this year as we grow. And particularly, we’re finding areas to reduce expenses, developing our own data, for instance and just some of the contracts that we’ve recently signed have higher margins as well. So — so yes, we’re expecting to increase our margins as we grow.

Operator: We will move next with Michael .

Unidentified Analyst: And congratulations on your year. A couple of questions here. I know that there was a ramp phase for the large Canadian bank you signed. Were all of the products that they signed for a fully operational in the quarter or are there more deliverables that could influence revenues in the upcoming quarter?

Dave Shworan: Still being delivered. So it’s — it’s an ongoing project where we’re releasing piece by piece. And so it is — it’s not — nothing is fully released yet.

Unidentified Analyst: Got you. And so you would expect from the revenue growth from that Canadian bank to see further revenue growth year-over-year?

Dave Shworan: Yes.

Unidentified Analyst: Okay. And not driven by pricing but just driven by additional products?

Dave Shworan: Yes, additional products. I mean, once all products are released, then it’s based on usage and then continued growth of other products. Yes.

Unidentified Analyst: Got you. Can you give us a sense maybe some context of the revenue growth. Obviously, interactive content and data applications was a key driver for revenue growth in 2023. I was wondering if you can kind of give us a sense of — was that driven by number of subscribers, price increases, can you just kind of give us a sense of the demand there. And then also in your context of your growth estimate for 2023, are you anticipating that the same trends that we saw in 2022 or the similar revenue trends that you’re expecting in 2023 in terms of your core stream, individual quote stream and your other product categories?