Vivek Shah : Yes, great questions, Cory. And so I’m glad you asked about this because I did think and find it to be a very interesting analysis. So remember, last quarter, the analysis was, well, Bing is the only at-scale generative search product in the marketplace, how is it going for us? And the analysis said, it’s going really well. And by the way, that’s continued into this quarter. but then we wanted to dig in deeper and say, okay, but how often is the SERP, the search engine result page, how often is it actually infused by AI versus non-AI. And I think we were somewhat surprised at the low incidence and prevalence levels of that with respect to the keywords that matter to us. Now the next, and by the way, we did that from Google also because that we could see in Google SGE.
The next analysis probably, Cory is, what you’re asking, which is, is this dissimilar to other keyword categories and to other properties. And we haven’t done that yet. So that’s an interesting question. It’s something we should analyze and understand. But at least with respect to us, the incidence levels were lower than expected and were consistent between Bing and Google, which I also found somewhat interesting. But then we looked at, well, when there is a generative search component and non-generative search component, non-generative AI component, are there differences in the clicks that we’re getting out of that page? And the difference is the generative search was actually higher. And so again, I’m not saying surprising to me based on my own observations, I think in the past, I would say, consistent but so in some senses you can say, well, huh, the generative piece might actually be accretive to click-through rate.
It’s early days. We couldn’t do this on Google SGE, by the way, because you cannot separate in reporting the Google SGE experiences from natural Google or from default Google. You can do with Bing, obviously, because it’s not 1 experience, right? So we can attribute entirely to the Bing experience. look, all to say that — and I’ve said it before, and I’m attempting to bring to the marketplace real data around this, which is I think the concerns that I hear are really overdone. And I think are overly simplistic and really is not the area that we’re really thinking about. I know it’s on the minds of a lot of investors, which is why we want to accommodate this through all of this analysis. But more to come, we’re going to continue to unpack this.
And last thing I’ll say on this, is just on Moz, we own a leading SEO authority and essentially think-tank, and they confirm everything that I’ve described. So that’s another data point internally that’s kind of — we have an SEO bookings institution or something inside of our company, and that’s always valuable.
Operator: The next question is coming from Ygal Arounian from Citi.
Unidentified Analyst : This is Max on for Ygal. Just you mentioned the investing more in head count and growth initiatives for next year. So maybe you could walk us through, where you’re investing in, what aspect — where the business you’re hiring in the growth initiatives for next year? And then just 1 on Xyla, maybe — it sounds like it’s — the partnership is going well, expanding it at connectivity, but the only thing you can share on the first partnership into health and wellness — and then just where do you see that going next year?
Bret Richter : Thanks for the question, Max. I think the macro point we’re making about our head count spending is that we did not view and don’t view 2023 as a year where our marginal point of margin is sacrosanct and that we have to deliver that last bit of profitability as we navigate what has been an improving quarter-to-quarter, but on an uncertain environment, macro and for certain of our businesses. I think Q3, as Vivek noted, is to a degree a turning point or milestone as we brought organic growth back to flat, and we are leaning in to finish 2023 strong. And throughout the year, where we saw pockets of opportunity in our businesses we spent. And some of that spending is concentrated in pockets of our businesses that are growing.
We talked about health growing, we talked about connectivity growing, gaming, although tied to the product in the marketplace, strength this year. So we are loosening the reins on the business where we believe there’s opportunity to pursue. As we complete 2023, some of that talent in place — dynamic business. We constantly need more talent. We’ll continue to lean in. And then we’ll have to find areas of pullback from time to time, but it’s really across the business wherever we see that opportunity.
Vivek Shah : And Max, just on your question on Xyla. I’m happy you picked up on the point, which is Xyla as a partner is helping us across the entire company, which has been really exciting. They’ve got a perspective, a skill set, a set of capabilities that are really helpful for us across all the various businesses and real concrete things are happening. With respect to health and wellness, nothing’s been launched yet. We’re hopeful that early part of next year, we’ll start launching and rolling out products. We’re very careful in health. And obviously, you’ve seen or know of the executive order, we have to be very careful in the health space with respect to whatever we do in AI. So we want to be measured thoughtful and deliberate. We’re certainly, I think, on the front edge of this but we have to be awfully careful in this space.
Operator: The next question is coming from Kunal Madhukar from UBS.
Unidentified Analyst : This is Jason on for Kunal from UBS. A couple of questions from me as well. The first one is on capital allocation. You guys have been consistently buying back stock year-to-date. And I’m curious to hear about your capital allocation priority at the moment given that you guys also seem pretty engaged in any imminent M&A opportunity as well? So where do you guys expect to allocate your capital, say, in the next 6 to 9 months? And on the long-term outlook, I understand that you guys are focusing on turning the business around to return to growth. But from a long-term perspective, what would you highlight as the main drivers for you to potentially grow more than mid-single digit organically as — in which verticals do you see the most attractive opportunities in the real apart from the M&A?
