Adcore (TSX:ADCO) Q1 2026 Earnings Call

0:01 All right, good morning everyone and thank you for joining us. Earlier today, ADCO released its Q1 twenty twenty six financial results. Today we will be walking you through these results and providing you with an update on the ongoing company initiatives. You might see some familiar faces here on the call today. I am Martin Van de Ven, Chief Partnership Officer for the company and overseeing Investor Relations. With me today is Henri Braille, the Adcore CEO and Founder and we also have Amit Komforti, Adcore CFO on the call.

0:36 The agenda for today: Before we begin, we go over some forward looking statements you should be aware of while listening to the call and then we follow that with some CEO opening remarks and the CFO financial highlights. Finally, will conclude with Q and A and if you have any questions throughout the call, please submit it through the questions feature here in Zoom. We will make sure to answer these at the end of the call.

1:04 All right, before we begin, I will give everyone a quick moment to review the statements. Please bear in mind when listening to the call today that the management team may use some forward looking statements which are inherently uncertain in nature. I'll give everyone a couple seconds to go over.

1:29 Alright, very good. And with that, I would like to pass the floor to Omri for some CEO opening remarks. Henri, the floor is yours. Thank you very much, Martin and good morning everyone. Martin, can you stop sharing please? Yeah. Thank you. So, before I'm going to start my opening remarks, I want to say again, it's our pleasure to discuss today the company results, financial results for Q1 twenty twenty six. Actually, both myself and Martell are now in Toronto, Canada, Right? So not in every day, we have a chance to do the any call directly from where we are listed. So it's a it's an exciting opportunity for us, you know, to discuss it from Toronto, from Canada.

2:14 Obviously, after this call, we have a full agenda line up for us. Right, Martin? We're going to meet with our team in Canada. We're to meet with clients. We're going to showcase them, like, some of the exciting stuff that we've been working on. So again, it's our pleasure to be here today in Toronto to discuss the company Q1 twenty twenty six results. Let me start by sharing my screen.

2:41 Okay. Very good. So a very strong start of 2026 I would say revenue up 22% year on year, APAC revenue growing 42%. So the same, I would say, momentum that actually we saw in the end of twenty twenty five, in Q4 twenty twenty five carried well into 2026 as well. And this is makes us very positive about what is still ahead of us for the entire 2026 year. To be honest, even if you're going to talk like U. S. Dollar because there was some influence of exchange rate during this quarter, then the results are even more dramatic, almost 27% year on year increase top line revenue, we talk in USD and and the gross profit, for example, six percent up USD compared to almost flat in in Canadian dollar or maybe 1% up in Canadian dollar.

3:37 So quarterly results, 8,500,000, very strong quarter for us compared to CAD 7,000,000 in the previous year, 22% decrease year on year, 27% decrease year on year USD and gross profit again 3.1, up 1% compared to to the same period last year or 6% actually USD compared to the same same period last year. If you if you look at quality growth KPIs, and again, gross profit 3.11 up, cash and cash equivalent 5,100,000. We saw a decline compared to q four, but I would say it's mainly seasonality decline.

4:23 A lot of the, I would say, spend and campaigns that were happening in q four twenty twenty six and money was flowing, you know, like during this quarter, actually was paid, you know, during q one twenty twenty six and that reflect in the numbers when you look at, let's say, and Amit is going to cover it in more detail, working capital, then obviously you're not going to see such a sharp decline. So and that's a good indicator that basically there's nothing dramatic happen, it's just, I would say, seasonality cash flow between the quarter. So just to warm up some of the highlights we cover most of them, guess, top line revenue, 8,500,000, a 22% year on year increase, big numbers, big growth.

5:09 Gross profit $3,100,000 1% year on year increase. APAC continued to show very strong momentum, 42% year on year growth. That's I would say the fastest growing market for us today. EMEA almost, I would say, flattened and actually North America has done 7%, but actually for us it's positive signal because we see North America is flattening. We did saw some softness in this important market in 2025 and the company now believe that this softness is more or less ended and actually we expected to see this market going to positive growing trend in 2026 as the year unfold.

5:58 Would say Amit will cover the result in more detail. So I would keep some of the outlook to Amit to cover, but what actually I would like to discuss now is to new technology or developing new technology the company is building and basically we are very excited about and I want to show both of them in action so you have better understanding what is under the hood, what type of AI innovation technology the company is building. So Proposalie, obviously, we've been talking about Proposalie during also the last earning calls, but I think like this is a major change or shift in the product promising. So Proposalie started as I would say document platform or sales document platform. So and and the promise was quote to revenue. So basically, we're gonna generate a very nice looking quote for you. You can share it with your client.

6:53 You're gonna close more deal for you and basically generate in the end of the day more revenue. But in the end of the day, the platform was, you know, like manual platform. You need to still manually generate the the quote and send it to your client. But now what's for full for Pozzi is becoming, I would say, it's a full agentic platform and actually covering much bigger, I would say, promise of the sales funnel. So imagine sales funnels that run themselves and basically with the new proposal, this type of imagination would be the reality. We're gonna have AI agents closing every deal from lead to revenue, and and basically, that's gonna be the new reality of their proposal.

7:38 No longer pull to revenue, we are expanded to lead to revenue platform, but I would think the most important thing is that everything will be done agentically by AI agent. And when we talk agentically, we talk about four different agent. We have inbound agent, that's an agent that sees or lives in the client's websites, basically every time a visitor comes to the client's website, can start interacting with this agent and the agent's goal is either to convert them to lead or even basically create and send like personalized quote to them. And that's a big promise. This agent is already live. It's already shipped and it's already working and I will give you a presentation soon. And the second agent in the pipeline is outreach agent. So imagine the inbound agent already converted the client into a lead, but this lead got called. So the outreach agent now gonna take in charge and basically try to convert to warm again this lead and basically make sure that it's warm enough to send him a quote and basically start his process of converging converting him.

8:47 And then we have the four the third agent, so it's the deal agent. So once a quote is generated, this is the when the deal agent gonna start taking command. And basically, his role is very simple yet important, making sure that this deal is converted. So basically, it's no longer a quote. It's becoming a revenue. And basically, the client signed the deal, closed the deal, paid for the deal. So that's the deal agent's responsibility. And last but not least, and is the customer agent. So the customer agent is gonna be take commands once the deal is already closed. So is we're gonna be making sure the customer is happy, satisfied, that he gonna offer cross sell and upsell opportunities for the client. So between these four agents, we are talking a complete agentic sales funnel, you know, from lead to revenue, inbound agents sit on the client's website, outreach agents, you know, a cold outreaching, you know, cold leads and make sure that they are warm again, Deal agents, you know, make sure sure that the deal is closed.

9:48 And customer agents, make sure the customer is happy and we can upsell and close them as well. That's a big promise. And basically, to solve a lot, I would say, of the issues of most businesses on planet earth. And I wanna show you a live example how it's everything is working.

10:19 Okay. So we are we are on a on a demo website for pest control pest control company from Phoenix, Arizona. Action, that's a real company. And basically, what we did, we just, like, put the demo agent on the website, the inbound agent. I'm gonna now interact with him, ask him question about the services they are offering, and everything gonna be done in real time. So, basically, there's not gonna be, like it's not like a prerecorded demo or anything like that. I I what I what's going on right now, I'm gonna start speaking with this agent. So, basically, that's look to you like maybe like a normal like a normal chat, but I would say now I can switch to voice mode as well.

11:13 Hey. Good morning. Good morning. What's going on with tests at your place? Oy. It's a lot going on, to be honest. Got it. Sounds like a busy situation. What pests are you seeing most right now? Ants, termites, roaches, or rodents? We have an ant issue. Got it. An ant problem. Are you looking for a one time ant treatment or ongoing monthly ant protection to keep them from coming back? I don't know. It depends. How much is each?

11:53 For ants, a one time treatment is typically around a $149. An ongoing monthly service is typically around $49 a month. I can send you the details for the one time ant treatment or the monthly ant protection. Want me to send one of them? Yeah. I think let's start with the one off and take it from there. Perfect. I just need a couple of quick details and I'll send it right over. Okay. So this was a real conversation I did with this agent. Right? Everything was voice.

12:43 He give me, like, a good answer. Everything he got, all the information about this specific two treatment that he have with uncontrolled. In the end of the day, this bot just generated a custom quote for me. So I can click on the quote, it just, you know, generate for me and look at the look at the price quote itself. So that's the quote like you say it was $149 We have add ons options. I can I can add let's say $49 and add like multi multi pest treatment as well? So maybe I have cockroaches or other issues in my home. So you see the price was already changed to from $1.49 to $1.99. I can click continue. He he asked me if I wanna add the tip, obviously, so I can already pay or add the service charge within the app itself. And final step gonna be going to payment.

13:41 So everything is done, you know, from from the app. The bot basically in real time generated the real price quote for me. And and that's that's a big promise. And whether it's gonna be the lead itself or whether it's gonna be whether it's gonna be the actual the actual, you know, like, you're sending the actual payment, then basically, all of that's done now in real time with the bot, with the AI agent and you can chat with him, you can speak with him like you're speaking with a human being. It's a very promising,

14:12 I would say, offering. And now so that's

14:22 sorry. That's one one, I would say, new feature or it's not just the feature. That's the future of Proposal. We have what you just see and it's a big promising future. Proposal is going fully agentic. We are turning from a, I would say, document flow type of platform for, you know, fully agentic sales funnel platform, everything formally to revenue and beyond. So that's a big promise and that's already in motion. Inbound agents, already live shift. Outreach agents already in process. We are building it as we speak. Deal agents should be ready by the end of this quarter. So we're talking about one and a half months from now and customer agent will be follow as well. So big promise with regards to this, I would say, the direction direction of proposing.

15:13 So I wanna cover another app. I know we mentioned maybe the AI Studio app before, but you never saw it in action. And when now we feel how it's look like and what's basically we can do with the AI Studio app. So the promise with the AI Studio app is design like a pro without being one. And you can see like, I don't know how familiar you are with online marketing, but I would say the single biggest roadblock to nowadays in the online marketing, I would say, is ad creative. So that's the most important, you know, like, I would say, part with any campaign and especially with rich type of ad creative, whether it's banner, whether it's UGC video, whether it's commercial video. All of this type of video now taking a long time to produce.

16:02 The bottleneck, you need to have, like, a dedicated studio for it. It's take time. It's not something that the online marketer usually can do itself. And basically, it's a real pain in the real bottleneck for, I would say, businesses on planet earth as well. And AI Studio was designed and built to solve this problem. So let me share my screen again with regards to the AI Studio app. And one second. So basically I want to cover few type of assets you can create with the app. The first type of assets that we're going to create is a banner.

16:54 So every asset starts with a simple brief, right? Now this is a real example of real time to pass in a Canada, office tech man, they're selling a hockey gear online. And basically, so we give them the brand, you can pre enter the brand, putting the brand booked, is logo and everything into the platform. So the platform will know this specific brand already. Give them the campaign brief, you know, what we're trying to sell. This like he's going for a specific product so I can check and upload the product images as well. And I select what type of assets I wanna create, whether it's banner and image and clip, UGC video, commercial ad

17:35 video. So once I selected, let's say, in this specific example banner, next will be to select the copy. So using AI, the system already pre generated a copy for me. I can select a specific copy. I can customize it if needed. I can select a short copy. I can like to select the longer copy, for example. It doesn't matter. So once I'm happy with the with the copy, next will be

18:02 the system will will give me some kind of banner banner design direction. So give me, like, multiple direction. We have this this with, like, with the person. This is just the gear in the in the front. You know, again, like, multiple multiple design direction and I have, like, eight different design concept I can choose from. So I can generate more if I needed, if I'm not happy. But let's say in this specific example, we selected this specific design. This is the concept that we are happy with. And basically we continue to production.

18:37 In the production stage, I can select which channel I would like to generate the assets to. So each channel come with all sets of, let's say sizes for the banner. And basically in this example, I selected meta and it's generated like four sizes for me and you can see like this specific example, This is more landscape type of a type of banner for example. And just one second.

19:06 And and everything was done by AI. So all this resizing was done, you know, from the concept banner by AI. There there was zero zero human intervention. This is like a landscape banner and this is like a a more square banner, for example. So again, this is like real life, the real banner that the system system is is is is built and everything done with, I would say, few clicks. So so from start to finish,

19:33 I if if you remember, I started the campaign, giving a brief upload some product images, then selected the copy for the banner. Then he give me, like, few design option. I selected one design option, and then let's say I selected I wanna generate now four sizes for meta generated, done. It's everything, I would say, from a to z, z maybe couple of minutes, max, and that's it. And if the same process would need to be done manually, let's say, by a creative designer, that's gonna be hours of work, you know, like, doing everything,

20:07 choosing the right copy, give, like, few concept direction for the banner, and and just creating the sizes. It's a lot of work by itself. And everything is done now with with the with the with the platform that's nothing short and amazing. So this is one type of a video or or asset I would like to create I'd like to show you. Another type is very similar in concept, but it's a UGC video. So again, we start with the brief.

20:34 This is for another client of ours. It's a tiny lab. They're they're creating amazing baby toys. So once we created it, it give us a script of the video so we can select, you know, what type of, you know, like, what is the story we wanna say basically. And then next is cast. So AI offering us, you know, four different, I would say, people or personnel, like young mom in this example, to do the UGC so I can select

21:04 what is best working for me. Obviously, you have the full context of the brief so you understand where I'm locating, whether I'm in The US or, you know, like in other countries. So obviously, the people would be reflecting, you know, like the the local people that are in this specific country. And then once I select, you know, like, okay, I'm gonna go, like, I this is a script that I wanna the the the person to say, this is, like, how the person should look like, and then I basically creating creating this video, and let let's run it

21:36 and see it ourselves. This this was created by the AI. Why did nobody tell me about this sooner? My little one is obsessed, and I'm not even exaggerating right now.

21:49 From the beginning? Hey, mama. Why did nobody tell me about this sooner?

21:53 My little one is obsessed, and I'm not even exaggerating right now. Okay. That's nothing short and amazing, and this is the real product. So we upload this specific product. So this product is live within the video. The person basically saying exactly the skip we wanted to say. We created a a very authentic look type of a UGC video and the entire process again, seconds.

22:18 So so that's like and and imagine you have, like, I don't know, 20 product, 50 product, 500 product. It doesn't matter. Like, for all of them, the system can create this type of UGC video in in minutes, I would say. Final example I would like to give is actually what we call commercial type video. Right? So again, started very similar with the brief.

22:46 Again, Okie Stickman, I applauded the stick that I would like to promote. It's called Pro Blackout and it's now on sale. It's more than 50% off. And I selected I wanna do a TV type commercial. Again, the system pregenerated to me, like, a different script and voice over. I I can say, so I can select this one, let's say, one story I would like to go for the commercial. And I have eight different, you know, type of, let's say, commercial I can create, you know, commercial types.

23:17 It can be more of testimonials, it can be other stories, you know, like, can select from different, let's say, eight different angle of direction. And then once I created the let's say, now I need to generate it. I can generate it landscape or vertical. It doesn't matter. And let's see the commercial that the AI generated for us. $300 sticks in a season. This one's the same carbon, same flex fab, $160. Hockey stick man, top end sticks, half the price. Shop Pro blackout. From the beginning. I've snapped $300 sticks in a season. This one's the same carbon, same flex fat, $160.

24:03 Hockey stick man, top end stiffs, half the price. Shop Pro Blackout.

24:10 Cool. So, again, this was generated by AI. Look like million dollar. Look like commercial. We can now ship to TV and and whatever we need to do with it. And, again, we control everything. Control the skip, we get to control the end count, the message, everything that need to be saying. And this is like like, I gave you now three example what can be generated with this app. So if you need banner, if you need UGC video, if you need commercial grade, I would say TV grade commercial.

24:42 All of that can be done now with this app. I never saw something like that. That's probably the best the best, I would say, AI studio app out there nowadays. Correct me if I'm wrong, Martin. Did you see anything better than this one? It's very unique. I'm very thrilled about it. Me too. Me too. So let's meet the two of us. And so

25:07 we go back to my presentation. That's concluded my session. So I know we covered some of the highlights of this quarter. Equally important, covered some very exciting stuff we can do now with AI, whether it's proposing becoming fully agentic platform covering lead to revenue life cycles, you know, for most businesses on planet earth. This is a massive, massive opportunity. And AI Studio, We can do magic now with you we're using this app and solve a big problem and big gap in the market as well.

25:42 And so my final remark gonna be on the share share price. Again, we cover it in every, I would say, earning call 25¢ as of May 8. We've seen a very big upside if we talk in EV to gross profit almost 600%. If we talk in EV to EBITDA, then a 13% upside. But again, I think like shareholders should see for ADCO as a different as a different company right now. As an AI company and I think what we we demonstrate to you today, it's the future of ADCO. So hopefully, you are excited as we are about this future and what this can bring to the company, what is bring can bring to potential client base and what type of problems we are solving in the market today using AI.

26:29 Thank you all very much.

26:33 Thank you, Omri. Very exciting stuff happening and appreciate you showing this to the audience today. With that, I want to hand it over to Amit Koforthy, CEO of the company for some financial highlights.

26:51 Thank you, Martin, and good morning, everyone. Before beginning the financial overview, I would like to remind you that the following discussion will include financial measures as well as non GAAP results. All amounts will be presented in Canadian dollars. The first quarter of twenty twenty six showed a strong start to the year with a strong revenue growth. The results reflect continued business momentum and ongoing efforts to improve the company's market position and client relationships. Let's review in more detail.

27:33 For the three months ended 03/31/2026, we delivered revenue of $8,500,000 compared to $7,000,000 in the same period of 2025, an increase of 1,500,000 or 22%. Gross profit for the three months ended 03/31/2026, was $3,100,000 compared to $3,100,000 in the prior year, relatively stable over the year. Gross margins for the three months ended 03/31/2026 were 37% compared to 44% in the same period last year. The decrease in margins is mainly driven by changes in client mix.

28:15 As for operational expenses, R and D expenses for the quarter were $400,000 compared to $600,000 in the prior year. The decrease in expenses is mainly due to increased capitalization of development costs. SG and A expenses for the quarter were $3,400,000 compared to $2,800,000 in the prior year, an increase of $600,000 or 22%. The increase was mainly driven by payroll related expenses and was partially impacted by foreign exchange rate fluctuations. Operating loss for the three months ended 03/31/2026 was $700,000 compared to $300,000 in the same period last year. Net loss for the three months ended 03/31/2026, was $800,000 compared to $200,000 in the same period last year, an increase of 600,000 Revenues and gross profit.

29:18 Looking at the quarterly results, we can see a strong year over year revenue growth. This continued the positive trend from the end of twenty twenty five as shown in the full year results to the right. Gross profit remained relatively stable compared to the same period last year, and gross margin levels were impacted by changes in client mix, and we expect margin to improve and stabilize as the year progresses. As for the geographical revenue breakdown for Q1 twenty twenty six, APAC revenues saw a very strong year over year increase of 42%. This increase was primarily driven by increased activity from existing clients and the acquisition of new clients.

30:06 EMEA and North America revenue decreased by 27% year over year, respectively. The results were mainly impacted by changes in client media budgets and foreign exchange rate fluctuations. In terms of financial position, we had cash on cash equivalent of $5,100,000 as of 03/31/2026, compared to $10,300,000 at 12/31/2025. Total working capital amounted to $4,200,000 compared to $5,100,000 at 12/31/2025, a decrease of $900,000 or 18%. As for the liability side of the financial position, we can see that the company is still debt free.

31:04 Adjusted EBITDA. The quarterly non GAAP results reflect adjustments for the following items: depreciation and amortization, share based payments and other nonoperational items. For the three months ended 03/31/2026, adjusted EBITDA was negative $265,000 compared to positive $208,000 for the same period in 2025. The decrease in adjusted EBITDA was mainly driven by the increase in operating loss. With that, I will turn the call back to Martin. Thank you so much, Shamit. With that, we would like to move on to the Q and A portion. I will have a couple of questions that came in.

31:53 First question is for you Henri. North America declined 7%, but you're seeing stabilization signals. What specific actions are underway to turn that into positive growth this year? Fair enough. So, yes, we are happy with the direction that this important market is going. We believe it is stabilizing actually and we are expecting to see like return back to positive growth trend as the year unfolds. I mean, there's a lot of focus now that we are putting on this market, whether it's Proposal related, there's going to be the biggest market for us when we're going to go fully on marketing marketing with with Proposal. Proposal. And again, a lot of initiatives that you're yourself involved with regards partnership as well. You and I just came back from a very successful event, TikTok invest in New York City. So again, this market is on the radar. We understand the easy policy.

32:53 We understand what it can bring to a company like ADCO, and you're gonna see great things coming from this market in 2026 and beyond. Great, Henri. And I echo that, a lot of opportunities on both partnership front and AI capabilities in our tech stack. The following question, I think it's a bit more financial in nature, so maybe for Amit to answer. Constant currency growth was closer to 27%. Are you considering hedging strategies so reported results better reflect the underlying operational momentum? Thanks, Martin. So basically, the company has past experience with hedging, which is not that good. We are applying as much as we can to align the revenue with the expenses for each of the different currencies that we work in.

33:45 And let's say that the Israeli shekel is strengthening against the US dollar, then we take the proactive measures to reduce the expenses and to increase revenues in Israeli shekel in order to reduce as much as possible the exchange rate that's impact on this. Yeah. I can echo what Amit said. Basically, we tried before to hedge. It didn't really work because you don't really control the direction the currency is going. We believe that, a, the company is quite diverse. Right? We have we have revenue and expenses in multiple currency, whether it's AUD, Israeli shekel, USD, Canadian dollar, Hong Kong dollars and others. So basically, are very much diverse. The key things for us, I would say, is making sure that we if we have expenses in Israeli shekels, then we need to have income in Israeli shekels as well covering. So this is the best edge, I would say, that we can take.

34:46 Thank you both. Thank you. The next question is about R and D spending, which came down 24% year over year. Is that sustainable while you're simultaneously investing in Proposalie and AI Studio? Actually, it's fairly interesting question. I would say a few things. A, shareholders need to bear in mind that we are capitalizing most of the R expenses. Having said that, we also have passed, I would say, products that we capitalize like, I think that we already now need to acknowledge them. So basically, at the end of the day, this is more or less flattening the R and D expenses. Some is capitalized, some show need it already. I do think that what changed a lot is AI coding, right? So what we can do now using AI, I would say X developer can develop X3, X5, you know, more code, the faster code than if we need even to compare it to one year ago. So I think like for the long run, with the same amount of developers or even sometimes even less, we can do much more, we can build much more sophisticated technology.

35:54 So I think like in that front, I would say things are looking very positive for software development. So means we don't need to increase cost so much, but we can definitely increase productivity and what we can ship and deliver. That makes sense. Thank you. Another question on the trade payables, they dropped from CAD8.4 million to CAD4.8 million consistent with your seasonal media disbursement explanation. Does the predictability of this holiday cycle give you better cash flow visibility going forward? Amit, do you want to take this one? Yeah, definitely. Yeah, so in the advertising business, we see this seasonality of Q4, which is very high in activity, which usually the payments for the Q4 expenses are done in Q1.

36:56 So we are very aware of this cycle, and we expect it to be also in forward in later years the same. So think it is predictable. Yeah. I think like a typical for us, we're starting like, I would say, losing cash a bit because of seasonality. And as the year unfolds, we regain this cash, you know, so we are continue to be positive about what we can do in 2026. And again, this is part of the normal course of, I would say, the business seasonality. Great. Thank you both. Another question that just came in on the financial side is, could you provide commentary about EBITDA growth trajectory in the rest of the year? Do we expect EBITDA to improve on a year on year basis moving forward instead of declining?

37:52 So, I take that. I would say the short answer is yes. EBITDA should be positive for 2026. Again, Q1 it's I would say difficult quarter in Ted's remarks, like there's a lot going on. There's a lot of expenses that are related to Q4 that's actually happening in Q1. So that's already passing the equation, I would say. And again the EBITDA was more or less flattened so I think like if we look at early then definitely we should be able to showcase positive EBITDA here as usual I would say. Thank you. Thank you. Gonna move on to a couple of questions that came in on the AI products and outlook on the product development. First around, purposely, the inbound agent is in production and the AI studio is getting strong data feedback.

38:41 Can you share any early quantifiable metrics such as users, pipeline influence, conversion rates just to help investors size the opportunity? Okay, I would say the following, it's a bit too early to share these type of metrics with the with the shareholders, but I would say in terms of, let's say, the size of opportunity is as big as it can get, you know, like I say, if we're talking for Pozzi and and basically, it's all, you know, like, the issues that most of businesses in plant health are basically struggling with, which is basically sales. So every business that start with lead and basically need to turn this lead into revenue. And, again, this is most of the businesses in times of whether it's own services like the pest control action company that we show from Arizona, whether it's a, I don't know, like in a in a college, for example, that basically you want to recruit new students to start, you know, like the next the next year with them. Whether it's a company tech company or services company like Adcore that serve, you know, clients for digital marketing or offering, you know, software to clients. All of these companies started their sales journey with a lead and basically need to convert this lead into revenue and basically then needed to like Proposal, an agentic tool to help them do achieve exactly that. So we're talking about billion of billion of billion of market share and this is like the potential is, I would say, unlimited.

40:11 So this is just proposing. And if you're talking AI studio, then again, like online marketing, it's a massive business. We're talking hundreds of of billions of dollars every year going to online marketing. And like I said, the single biggest bottleneck nowadays in online marketing, it's digital assets. It's the videos. It's the panel. It's everything that you need to create. So we are tackling or solving the biggest problem nowadays in online marketing, and let's show you, you know, the potential of a tool like AI Studio f 12. And like I said, we are getting, like the the the the the feedback that we are getting from early user is, like, wow. Like, we couldn't believe, like, where where are you guys, you know, like, I don't know, a year ago or even six months ago.

40:56 And that's exactly what keep us, you know, so excited about the solution we are building and why we continue working so hard, you know, like building it, improving it, and making sure that we are the best out there, which we are currently. That's great. Yeah. And that's a great testament how fast AI is developing and how Adcore is able to adapt and leverage that. Given the time, we have room for one or two more questions and then I'm going to add to the closing remarks. One more question around the product stack. How are you thinking about cross selling these new AI products into your existing Marketing Cloud client base? It's a good question, I would say and I wouldn't think that people would be surprised for my answer, but the sales calls that we are doing is for existing clients. Right?

41:44 So if we we launch AI Studio, the sales phone calls were to existing clients, hey, we have something amazing to show you guys, you know, and and we want you guys to test it, to try it, to see, to give us your feedback. So I think, like, existing client tests are the best type of clients we can, you know, like, work with when we launch new product, whether it's for positive, whether it's AI studio. So trust me, these are almost and always gonna be the first call phone calls that we're gonna make when we launch something new. You can trust on it. Thank you, Henri. And the last question for today, is Proposalea strategically planning to position itself more aggressively into the growing high ticket sales market? That's actually an interesting question or remark and I would say the following, I'll answer this question with a story.

42:33 When we initially thought about Proposal and it was just an idea, you know, that sit in the drawer of nice things to do, start ups to build, They're basically the the ICPs that we were thinking about was home services, small businesses, you know. And and there's plenty of them on planet earth. You know, if we talk in US alone, a pest control business, it's $25,000,000,000 yearly, Just on pest control services in The US. So it's massive market and and and roof, and construction, and, you know, like air condition. Like, we're talking about, like, multi multi billions, you know, almost trillion dollar, I would say, just on services in The US maybe, accumulative or up a trillion. You know, like, it's big numbers that we are talking about. And these numbers are actually build up from a lot a lot of small businesses in different towns and and and cities within The US, for example, and and and other place in the world as well. So and we said, okay. Let's build something for this for this group of people. And I guess, hey, it's not a small group. Right? It's like a big big industry by itself.

43:39 And then when we start building proposal, we say, wait. Even company like us, like ADCO, should actually use proposal to send proposal, you know, to clients. And we are I think it's like like this equation say, markets are the same. If you're in a lead to revenue business, which most, you know, businesses in Planet Earth are still in this business, then definitely you should use Proposal. That would be my answer. So I don't care if you have all services from, you know, like, from from Arizona, for example, from Phoenix or Phoenix, Arizona, or you are an Etech company sitting in Tel Aviv, Israel, it doesn't matter. You are in a little business, you're in a little revenue business, you need to use proposal. Thanks so much, Omri. Very exciting to hear about this potential.

44:30 With that, is there any closing remarks you want to share with the audience today before we wrap up the call? So, I think like we covered a lot, right? We started, this is also something Amit mentioned as well. We ended up 2026 strong in Q4 results was really strong for us and we started Q1 twenty twenty three and 2026 strong as well. So that means the same momentum that we saw in the end of the year in 2025 is carried well into 2026. That's always keep us, you know, very positive about what we can achieve as the year unfolds. But what even keep us more positive is the is the, I would say, level of innovation and the depth of innovation now we can do using AI. And we give you, like, few, I think, like, astonishing example, you know, like, about the inbound agent. I speak with him. He on the fly, generate a custom quote for me for unscriptural issues that they have. They can send it over, you know, send it in the chat. He can like, he send it to my WhatsApp or email, whatever content detail I gave you.

45:32 You show, like, how I can easily, in minutes, create astonishing, you know, like, banners, UGC video, commercials, you know. All of that that you see right now wasn't exist in the beginning of 2026. So this is something we built and shipped during q one twenty twenty six, and this is like that's amazing. So again, ADCO is changing. We're becoming like a full AI company. The potential is massive for us. And and I think, like, that's the best story to say to tell some right now, and we are excited about what things ahead of us, you know. That's that's the honest truth. Alright. Exciting things ahead. And with that, we conclude the earnings call Q1 twenty twenty six. We thank you, of course, Henri and Amit.

46:17 And most of all, we thank you everyone who's joining this earnings call today. We look forward to seeing you next time. And for now, wish you a great rest of your day. Thank you. Thanks, guys. You too.