So SG&A is expected to grow but that is tied to marketing and that growth is something that we can expand or contract based upon ROAS. The other thing that I think it’s important to talk about when considering marketing in our growth plan is the fact that marketing is a much different animal than it was 3, 4 years ago because of all the privacy stuff, whether it be AT&T with Apple or soon to be Google’s Privacy Sandbox. And that will mean that it will take more time to get recurring results that one can then I’d say with confidence, hey, we can expand or this is not the right thing to optimize yet. However, as I have also mentioned in my recorded remarks, we have prioritized for the entire company, the notion of really building out this full stack marketing team and seeing to it that we address not only paid user acquisition expertise but also things like app store optimization, search engine optimization, branding, product marketing just to name a couple of those components.
So that is what we believe to be critical for the growing success of our business.
Allen Klee: For fiscal ’24, I think historically, the first quarter is a seasonally slower quarter. Would you agree that, that’s most likely? Maybe talk about just the seasonality, how that typically plays out in the quarters? And is there anything you wanted to comment on financial outlook or goals of just any type of financial goals for fiscal ’24?
Jonathan Reich: Sure. So we’ve historically not provided projections. I will say that seasonality because we have a very, very large percentage of revenue coming from advertising is tied to ad spend typically in the holiday season. So our fiscal Q2 which is November, December, January is typically the strongest quarter of the year. And then when you get into calendar, let’s say, calendar Q2 — or one, I should say, you begin to see a downturn. So although we’re technically a month off, generally speaking, seasonality for ad spend aligns with what happens in a typical ad-driven business. And — that generally hold up. It’s not 100% the case but that generally is an indication of how our business is impacted. We are fortunate because we do have other diversification or we have diversification with the subscriptions in there and so on and so forth.
And that subscription revenue, as you know, is amortized over the life of that subscription. So going back to my earlier comment, our ability to continue to have success with our overhaul subscription offering for Android or the newly introduced iOS subscription offering is something which is really a key part to our ability to diversify revenue and have some insulation there, if you will.
Allen Klee: One of the other things you mentioned was — as an initiative for fiscal ’24 is building out your marketing capabilities. Could you maybe just expand a little more on that on what you meant by that?
Jonathan Reich: Sure. Prior to the acquisition of GuruShots, Zedge’s growth was primarily driven by organic installs where you know that we surpassed in aggregate over 600 million installs of our app on a global basis. And the acquisition of GuruShots introduced a new facet to marketing, where in the mobile gaming space, paid user acquisition is key growth driver. And in parallel with that, we had also started to part in the market with respect to paid user acquisition our flagships Zedge marketplace. And we have expanded that investment over time with what we believe to be attractive return on ad spend investment. Much different profile between the Zedge marketplace around Zedge App, page user acquisition versus GuruShots. But in order to be successful in our investment in marketing, we have many different areas that we are refining and we are investing in.
